The cryptocurrency market has crashed! Ethereum has dropped nearly 30% in two weeks! Did Bitcoin dip as low as $70,000?

Although since US President Trump took office, he has continuously promoted an "embrace" of cryptocurrencies, after the initial sharp rise, cryptocurrencies have fallen back into a downward trend.

Even the news that Trump announced the creation of the US Strategic Cryptocurrency Reserve on Monday couldn't drive the rebound of cryptocurrencies.

As of the time of writing, Bitcoin has fallen below $84,000, and the price of Ethereum has even dropped to around $2,000.

Now, investors are extremely concerned about when this downward trend in the cryptocurrency market will stop.

The collective crash of the cryptocurrency market

Last week, the cryptocurrency market witnessed a panic sell-off, and the price of Bitcoin dropped by more than 10%.

As for Ethereum, it still hasn't recovered from the hacker incident. It has been continuously falling sharply, dropping by 10% last week and 17% this week.

March 3: Trump announced in a high-profile manner that "BTC, ETH, and SOL are included in the US strategic reserve." As soon as the news came out, the market reacted violently: XRP soared by 32% in a single day, SOL rose by 23%, and ADA even pushed this carnival to a climax with an astonishing increase of 64%.

March 4: The plot took a sharp turn! Trump suddenly imposed a 10% tariff (a cumulative 20%) on China, and imposed a 25% tariff on Canada and Mexico. The global market panicked and crashed.

Funds frantically fled risky assets, and the liquidity of the cryptocurrency market evaporated instantly. The long positions of BTC/ETH futures became a "disaster area of death".

The "frightening night" in the cryptocurrency market has made investors deeply realize the cruelty of the cryptocurrency market.

Why the sharp decline? Is it due to the tariffs?

Last week, the Fear and Greed Index for cryptocurrencies dropped to its lowest level since 2022. This indicates that investors have no interest in investing in the cryptocurrency market.

I think there are several reasons for the current bearish situation of Bitcoin:

First of all, the macroeconomic situation does not constitute a bullish factor for cryptocurrencies. The Atlanta Fed's GDPNow model now predicts that by the end of the first quarter of 2025, the US GDP will contract by 2.8%. From an economic perspective, compared with the 3.9% growth predicted four weeks ago, this forecast result is disastrous.

Another important factor is Trump's proposed tariff policy. Although some analysts believe that tariffs are not the main reason. However, every time Trump announces tariff-related policies, the cryptocurrency market has experienced a sharp decline.

Finally, I think a very important point is that the geopolitical conflicts have cooled down, and the demand for hedging has weakened.

At this stage, the geopolitical risks such as those between Russia and Ukraine have eased, and the market's risk aversion sentiment has cooled down. As a new type of hedging asset, the decrease in the hedging demand of cryptocurrencies has weakened its price support.

Of course, the outbreak of the largest theft case in the history of the cryptocurrency circle has, to a certain extent, also triggered this round of selling. Last Friday, Bybit, the world's second-largest cryptocurrency trading platform, was hacked. The scale of the attack was huge, and more than 400,000 cryptocurrencies with a total asset value of more than $1.5 billion were transferred to unknown addresses. The incident once again ignited the market's panic sentiment. Combined with several previous Bitcoin thefts, investors can't help but question the security of cryptocurrencies.

When is the right time to buy?

Arthur Hayes, the co-founder of the cryptocurrency derivatives exchange BitMEX, recently stated that although he firmly believes that we are still in a bull market cycle, in the worst-case scenario, he expects Bitcoin to return to the previous cycle's all-time high of $70,000.

Similarly, Gracy Chen, the managing director of the cryptocurrency trading platform Bitget, said that although institutional investors' interest in Bitcoin is increasing, the price of Bitcoin may still fall to the range of $72,000 to $80,000.

In my opinion, looking ahead to the future trend of Bitcoin, I think the cryptocurrency market will face greater pressure in the short term, but in the medium to long term, there is still a possibility of a structural rebound.

Once Trump fulfills his policy promises, or certain events drive up the expectation of interest rate cuts, the market will have the opportunity to regain its upward momentum.

So I think it may be a good opportunity to go long on Bitcoin in the range of $75,000 to $80,000. Of course, if it doesn't reach that level, I won't be sorry if I miss it.#ethereum #btc