Sharp Declines Across Major Cryptocurrencies
On February 3, Asia-Pacific stock markets opened lower while cryptocurrency markets experienced synchronized crashes. Ethereum plummeted by 25% at its lowest point, with Bitcoin showing multiple rapid declines exceeding 6% within 24 hours.
Key market movements:
- Bitcoin hit $91,130 before recovering slightly to $92,899 (-6.83%)
- Ethereum reached 12-month lows at $2,080 (-25%)
- Binance Coin, Dogecoin, SOL, XRP, Cardano, and SUI all dropped 15-20%
- TRUMP token collapsed 17% to $15.55 after 12-day decline
👉 Why experts say this crash differs from previous crypto winters
Liquidation Crisis Hits Traders
CoinGlass data reveals staggering consequences:
- 720,000 accounts liquidated ($2.21 billion total)
- Long positions accounted for $1.87 billion
- Largest single liquidation: $25.6M ETH position on Binance
Market analysts describe this as a "historic collapse" in cryptocurrency valuation.
Three Primary Causes of the Crash
Trade War Escalation
- New US tariffs on Canadian/Mexican imports
- Retaliatory measures from affected countries
- BTC Markets CEO notes: "Trump's tariff battles are creating recession fears across asset classes"
Regulatory Shift in El Salvador
- Bitcoin loses official currency status
- Usage becomes voluntary per IMF loan requirements
- 71% of Salvadorans opposed Bitcoin adoption
Global Market Contagion
- Japan's Nikkei 225 dropped 1,000+ points (-2.7%)
- South Korea's KOSPI fell 2.54%
- Nasdaq futures down 2% during Asia trading
Market Ripple Effects
Equity Markets:
- TDK (-9%), Denso (-8%), Honda (-7%) led Japanese declines
- Hong Kong's Hang Seng recovered to -0.04% after 2% drop
- Semiconductor stocks rose 7% in Hong Kong
Tech Highlights:
- Alibaba shares hit 2024 highs after cloud AI price cuts
- Qwen-Max AI models saw significant cost reductions
FAQs: Understanding the Crash
Q: How long might this crypto downturn last?
A: Historical patterns suggest 2-4 month recovery periods after 20%+ single-day drops, but trade war uncertainties could prolong volatility.
Q: Should investors buy the dip?
A: Experts recommend caution until tariff policies stabilize and ETF flows show consistent recovery.
Q: What's El Salvador's new Bitcoin policy?
A: Businesses may accept it voluntarily, but taxes can no longer be paid in BTC. The government still holds 2,546 BTC in reserves.
👉 How institutions are positioning portfolios post-crash
Looking Ahead
Market watchers suggest monitoring:
- Progress on US-Canada-Mexico trade negotiations
- Bitcoin ETF net inflows/outflows
- Ethereum's Dencun upgrade timeline
- Asian market reopenings on Monday
This developing story combines reporting from major financial networks and official market data.