The cryptocurrency market is in the red today, February 25, 2025, due to a series of events that have generated distrust among investors and triggered massive sell-offs. Below are the main factors that have influenced this decline:
1. $LIBRA scandal and the "LibraGate" case
Recently, the former president of Argentina promoted the cryptocurrency $LIBRA, which led to a sharp increase in its value. However, shortly after, the token collapsed, resulting in significant losses for approximately 40,000 investors. This incident, known as "LibraGate", has been labeled a "rug pull" scam, where developers inflate the price and then withdraw the funds, leaving investors with worthless assets.
2. Legal investigations and political crisis
The former president's direct involvement in the $LIBRA scandal has intensified uncertainty in the market. Argentine justice has initiated investigations against him and others involved in the project, generating political and economic instability in the country.
3. Outflows from crypto products
There is a widespread sentiment of risk aversion among investors, evidenced by continuous capital outflows from cryptocurrency investment products, such as ETFs and funds. This behavior reflects a lower willingness to take risks, which puts downward pressure on prices.
4. Massive liquidations
In the last 24 hours, over $650 million in positions have been liquidated, mainly long positions (bullish bets). This indicates that the market was over-leveraged, and the initial drop triggered a domino effect, forcing automatic sales that amplified the crash.
5. Correction after a rally
The market was coming from a period of euphoria, with total capitalization recently exceeding $3.16 trillion. The current correction, which began on February 21, seems to be a natural profit-taking combined with negative events that accelerated the decline. Today, the capitalization is around $3.1 trillion, a decrease of 3%.
6. External and sentimental factors
In addition to the $LIBRA scandal, other events, such as regulatory issues and the unlocking of assets from bankrupt platforms, have fueled fear in the market. The proliferation of memecoins and related scams has damaged the overall perception of the crypto market.
In summary, the current downward trend is the result of a combination of specific events, technical dynamics, and a shift in investor sentiment towards caution. Some analysts consider this moment as a buying opportunity, while others warn of possible further declines if key supports, such as $90,000 for Bitcoin, are broken.