The recent drop in the value of cryptocurrencies can be attributed to a combination of geopolitical factors and specific incidents in the crypto market.
Global Geopolitical Context
Recent economic policies in the United States, especially the trade tariffs imposed by President Trump, have created uncertainty in global financial markets. These protectionist measures have heightened trade tensions, prompting investors to reevaluate risky assets, including cryptocurrencies. In addition, inflation in the United States has shown an unexpected increase, and Federal Reserve Chairman Jerome Powell has indicated that there will be no interest rate cuts in the near term. These macroeconomic factors have contributed to a decrease in investor confidence in volatile assets such as cryptocurrencies. New York Post
Hacker Attack on Bybit
Meanwhile, the crypto market was shaken by a significant hack on the Bybit exchange. On February 21, 2025, Bybit suffered a theft of approximately $1.5 billion in Ethereum, making it the largest hack in cryptocurrency history. The attack occurred during a routine transfer from a cold to a hot wallet, when hackers managed to manipulate the process and divert the funds to an unknown address. Subsequent investigations indicated that the Lazarus Group, a hacking group linked to the North Korean government, was responsible for the attack. InfoMoney
Despite the magnitude of the theft, Bybit assured customers that it has sufficient funds to cover the losses and that withdrawal operations continue as normal. Bybit CEO Ben Zhou announced the creation of a bounty program to incentivize the recovery of stolen funds, offering up to 10% of the recovered amount as a reward. Cointelegraph
Impact on the Cryptocurrency Market
These combined events resulted in a significant drop in the prices of major cryptocurrencies. Bitcoin, for example, saw a 7% drop to $86,000, down 21% from its previous peak of $109,000. Other cryptocurrencies, such as Ether, XRP and Solana, also suffered significant losses. New York Post
Analysts point out that while the Bybit hack had an immediate impact on the market, macroeconomic factors and U.S. trade policies play a more significant role in the current cryptocurrency volatility. The combination of global economic uncertainty and crypto-specific concerns has created an environment of caution among investors, leading to the recent decline in the value of digital assets.
Therefore, it is necessary to be cautious, as in such an uncertain scenario any hasty move could result in huge losses.
