The CoinEx Research report in February 2025 pointed out that the cryptocurrency market has faced multiple negative factors and has declined significantly, with macroeconomic uncertainty, institutional capital withdrawal, and the political turmoil in the meme coin sector forming a "bear market storm". Bitcoin plummeted from a high of $102,000 at the beginning of the month to below $80,000, causing widespread market concerns. This decline was accompanied by an escalation of global tensions, including the Trump administration's new tariff policy, which had a ripple effect across the entire digital asset space. The hacking of the Bybit exchange, a black swan event, further exacerbated the overall negative sentiment. However, the launch of the Berachain mainnet and the inflow of stablecoin capital still provide the market with the seeds of a bullish structural foundation.
Dancing with Fear and Bears: Liquidity Depletion Exacerbates the Sell-off
The "Fear and Greed Index" of the market sentiment remained in the "Fear" zone in February, with the cryptocurrency market dominated by a bearish sentiment. After starting the month at $102,000, Bitcoin broke below the critical $80,000 support, and the depletion of liquidity in the meme coin market became a catalyst - the launch of meme coins like Trump Coin ($REALTRUMP) and Melania Coin ($MELANIA) further exacerbated the market decline. Additionally, the LIBRA token manipulation scandal (a price flash crash after the initial hype-driven surge) also dragged down the prices of Ethereum and Solana ecosystem tokens.
Trump Tariffs Weigh on the Crypto Market
The plight of the crypto market is closely intertwined with macroeconomic pressures. The Trump administration's new tariff policy has exacerbated trade tensions, and the market is concerned about economic slowdown and potential inflationary pressures. Risk assets will be the first to be affected. Some have pointed out that if central banks delay rate cuts or even raise rates, investors will be concerned that volatile assets like BTC will face more severe challenges.
BTC ETF Funds Flee
In addition to macroeconomic factors, institutional investors have also withdrawn from the cryptocurrency market. The net outflow of Bitcoin ETF products reached $3.5 billion in February, the highest single-month record since the ETF's launch. Amid increasing market volatility and uncertainty, this shift, combined with the chaos of meme coins, highlights the increasingly cautious and observant stance of institutional investors.
Market Scenario: Where Do We Go from Here?
Looking ahead, the cryptocurrency market may face several possible scenarios. One possibility is a rebound driven by positive developments in the macroeconomy or specific industries after the significant sell-off in February. If the pessimistic sentiment continues to ferment, BTC may plummet to $70,000, a price level not seen since before Trump's election. Another possible scenario is the start of a long-term bear market, with the weekly chart "lower lows" established. Finally, there may be a period of sideways consolidation, allowing the market to enter a new accumulation phase and potentially develop more stable support.
The Chaos of Political Meme Coins
In February, a wave of political meme coins swept the market, including tokens for Trump and Melania, as well as the newly introduced CAR and LIBRA tokens. The LIBRA token backed by Argentine President Javier Milei initially received widespread attention but quickly became embroiled in controversy, surging and then plummeting 80%. Investigations revealed the team's connections to past controversial token projects, triggering a crisis of trust. The ripples of LIBRA also severely impacted the Solana ecosystem, leading to a significant price drop in Solana's native assets.
Data source: Dex Screener
Exchange Security Alarm: Bybit Historically Hacked
The leading centralized cryptocurrency exchange Bybit was attacked by hackers, losing over 490,000 ETH (about $1.5 billion), one of the largest exchange security incidents in history. The stolen funds were further laundered through various channels, exacerbating market volatility, with Ethereum prices plummeting from $2,700 to $2,100. Investor anxiety increased, undermining confidence in centralized exchanges (CEXs) and putting downward pressure on other platforms.
As One Bear Departs, Another Emerges: Berachain Mainnet Launch
Ironically, while the market was mired in a bear market, the Berachain mainnet, a Layer 1 blockchain built on the Cosmos SDK and compatible with Ethereum, launched against the trend. Berachain has listed over 110 projects, with the Royco program pre-depositing $2.6 billion in funds and the TVL surpassing $3.1 billion, quickly ranking sixth in the public chain TVL rankings, demonstrating the resilience of construction in the bear market.
Stablecoin Inflows Resilience: Bullish Structure Remains Intact
Despite the challenges facing the market, the foundation of market liquidity remains stable, with a net inflow of $5 billion in stablecoins in February, down from $9.9 billion in January. This slowdown is seen as a natural adjustment in a risk-averse environment. The continued inflow of stablecoins is following the typical bullish pattern, indicating that the underlying market structure remains intact.
Conclusion: Glimmers of Hope in the Storm
In February 2025, the cryptocurrency market struggled amid the collapse of BTC, political turmoil, and major security vulnerabilities, but the successful launch of Berachain has kept a glimmer of hope for investors. The inflow of stablecoins remains strong, and the market may still have sufficient liquidity to weather the storm. As March approaches, the key question will be whether the market can bottom out and rebound, or further plunge into the abyss.
About CoinEx
CoinEx, founded in 2017, is a leading global cryptocurrency exchange incubated by the top mining pool ViaBTC. Adhering to the user-centric principle, CoinEx was the first to adopt the "1:1 reserve proof" mechanism to safeguard user assets. The platform supports over 1,300 cryptocurrencies and serves more than 10 million users in over 200 countries and regions, driven by the platform token CET. CoinEx Research continues to provide in-depth market insights to help investors seize opportunities in the volatile market.
