Cryptocurrency Market Crash: Hack Attacks and Massive Liquidations Trigger a Chain Reaction

Cryptocurrency Market Crash: Hack Attacks and Massive Liquidations Trigger a Chain ReactionThe cryptocurrency market has recently suffered a severe blow, with prices plummeting due to a series of security incidents and the resulting market panic. Several hacking incidents over the past weekend directly caused a significant drop in cryptocurrency prices and triggered massive liquidations

Cryptocurrency Market Crash: Hack Attacks and Massive Liquidations Trigger a Chain Reaction

The cryptocurrency market has recently suffered a severe blow, with prices plummeting due to a series of security incidents and the resulting market panic. Several hacking incidents over the past weekend directly caused a significant drop in cryptocurrency prices and triggered massive liquidations. Major cryptocurrencies like Bitcoin and Ethereum were severely impacted, severely undermining market confidence.

OKX data shows that as of now, Bitcoin (BTC) has fallen below $90,000, trading around $89,500, a drop of over 5%; Ethereum (ETH) is priced at approximately $2360, down over 11%; SOL is trading around $134, also down over 11%; and Dogecoin (DOGE) is hovering around $0.2, down over 10%. This indicates that the market downturn is widespread, affecting almost all major cryptocurrencies to varying degrees.

One of the triggers for this market crash was the hacking incident at the Bybit exchange platform in the early hours of February 22nd. According to the Securities Times, hackers exploited a platform vulnerability, successfully stealing over 400,000 ETH and stETH worth more than $1.5 billion (approximately 10.8 billion RMB), transferring them to an unknown address. This incident shocked the entire cryptocurrency industry, exacerbating market panic and causing investors to rush to sell their crypto assets.

Just two days later, another security incident occurred. On February 24th, news emerged that the Infini platform had been attacked, with an estimated $50 million in virtual assets allegedly stolen. Although Infini's co-founder later posted on X (formerly Twitter) that they would fully compensate affected users and claimed to have located and controlled the engineer involved, this incident further fueled market concerns about the security of cryptocurrency platforms. The hackers' rapid money laundering activities also negatively impacted ETH prices.

The decline in SOL is also noteworthy. Previously, due to the meme coin craze, SOL's price had surged to a high of $295. However, after the launch of the Trump coin ($TRUMP), SOL's price began to fluctuate and fall, now having been halved. This suggests that the hype surrounding meme coins is fading, and the market is returning to rationality.

More alarmingly, this market crash led to large-scale liquidations. According to Coinglass data, over 360,000 traders were liquidated in the past 24 hours, with total liquidations amounting to approximately $1.33 billion, including $1.25 billion in long positions and $0.08 billion in short positions. This shows that market sentiment is heavily speculative, and many investors suffered significant losses in high-risk trades.

This cryptocurrency market crash is the result of several factors working together. Besides hacking incidents, macroeconomic uncertainty, regulatory uncertainty, and market speculation all negatively impacted the market.

The hacking incidents at Bybit and Infini exposed vulnerabilities in the security of cryptocurrency trading platforms. This prompts a rethink of the security and reliability of cryptocurrency trading platforms and calls for the industry to strengthen its security measures to prevent similar incidents from happening again.

The massive liquidations also reflect a certain degree of risk appetite in the market. Many investors chased high returns through high-leverage trading, but also faced enormous risks. This crash serves as a stark warning against these high-risk investment practices.

In summary, this cryptocurrency market crash is the result of multiple factors, reflecting both inherent market risks and shortcomings in industry security and regulation. Investors need to rationally assess market risks, invest cautiously, and avoid blindly following trends. Meanwhile, the cryptocurrency industry needs to strengthen self-regulation and improve security to enhance market confidence and promote healthy industry development. This event is undoubtedly a significant test of the entire cryptocurrency ecosystem, and its subsequent impact remains to be seen. Market participants need to closely monitor relevant developments and adjust their investment strategies according to market changes. Continued security incidents and an unstable market environment will pose challenges to the long-term development of cryptocurrencies. Only by strengthening security measures and improving transparency can market confidence be rebuilt and the cryptocurrency market steered towards a healthier and more stable path.