Today, the cryptocurrency market experienced a 'bloodbath', with Bitcoin (BTC) briefly falling below $87,000, and mainstream altcoins like Ethereum (ETH) and Solana (SOL) suffering significant losses, with declines exceeding 10%.
Market sentiment has plummeted sharply, with the fear index dropping to 'extreme fear' levels. The total liquidation amount across the network has reached $956 million, and the bull market feast seems to have come to a sudden halt.
Market crash, who is the hidden force behind it?
The reasons behind this market crash are complex. On one hand, expectations of interest rate hikes by the Federal Reserve have intensified, putting pressure on global risk assets, and the cryptocurrency market is no exception.
On the other hand, the Bybit exchange suffered a hack, with $1.5 billion in assets stolen, triggering a spread of panic in the market. Additionally, some investors took profits, and tokens like SOL faced significant unlocking pressure, further exacerbating market sell-offs.
In terms of derivatives data, Coinglass data shows that in the past 24 hours, the total liquidation across the network reached $956 million, with the vast majority being long liquidations, amounting to $885 million. In terms of cryptocurrencies, BTC saw liquidations of $278 million, and ETH saw liquidations of $203 million.
Divergent opinions among big players make the future market direction uncertain.
In the face of the market crash, opinions among big players in the cryptocurrency field have also diverged. Arthur Hayes, co-founder of BitMEX, remains bearish, believing that BTC will fall to $70,000.
Chris Burniske, a partner at Placeholder, believes this is just a mid-cycle correction in the bull market, not the beginning of a bear market.
Altcoins have been severely impacted; has the logic of the bull market changed?
Compared to BTC, altcoins have suffered even greater losses in this crash. ETH has been affected by the hacking incident and is unlikely to recover in the short term. Meanwhile, SOL faces greater downside risks due to the retreat of meme coin hype and significant unlocking pressures. Market participants are concerned that this round of the bull market may evolve into a 'one-man show' for BTC, and the 'feast' for altcoins may be hard to replicate.
Distinguishing the false from the true, is the era of value investing arriving?
As the market matures, investors are becoming more rational. Evgeny Gaevoy, founder of Wintermute, believes that the future cryptocurrency market will focus more on the actual application and sustainability of projects, rather than mere conceptual speculation.
This market adjustment may be a process of 'distinguishing the false from the true', where truly valuable projects will withstand the test and welcome a reassessment of their value.
The cryptocurrency market is ever-changing. Whether this crash marks the end of the bull market or just a halftime break is still difficult to conclude. However, it is certain that the market is undergoing a profound transformation, and investors need to remain rational and cautiously respond to market risks. In the future, only those projects that truly have value support will stand out in the fierce market competition.
Disclaimer: The content of this article is for reference only and does not constitute any investment advice. Investors should consider their own risk tolerance and investment goals, and view cryptocurrency investment rationally, avoiding blind following.
