The cryptocurrency market, including Bitcoin (BTC), recorded a drop of over 10% on average until the early morning of the 25th, amid the prediction of the US interest rate freeze, the sluggish sideways movement, and the hacking of the exchange.
Experts analyze that "after the sluggish sideways movement, a sharp drop will occur, and what needs to be released has been released."
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The main causes of the cryptocurrency market decline are cited as the Bybit hacking, the prediction of the US Federal Reserve (Fed)'s interest rate freeze, and the surrender selling due to the continued sideways movement.
Recently, the asset market has been setting new highs for gold, a "safe asset," based on the Fed's repeated warnings of interest rate freezes, while the "risky asset" cryptocurrency has been declining daily.
Cryptocurrencies, including a 15% drop in Bitcoin after the inauguration of former President Trump, have seen more than 20% declines in most altcoins. The buying pressure that had risen due to expectations of policy changes from a cryptocurrency-friendly administration has turned into selling pressure due to the unexpectedly quiet moves of the Trump administration.
In particular, the Bybit hacking incident, combined with the sluggish sideways movement, is cited as the driver of the market's sharp decline.
The cryptocurrency market has been in a sluggish sideways movement for about a month. As the weak uptrend continued without any significant changes, and investor fatigue increased, the occurrence of the largest-ever exchange hacking incident transformed investor fatigue into fear.
On the 21st, Bybit was hacked by a group of North Korean hackers suspected to be 'Lazarus'. The Bybit hacking incident is considered the largest hacking incident in history, surpassing the Mt. Gox incident (470 million dollars) in 2014 and the Poly Network incident (611 million dollars) in 2021.
Although Bybit announced the recovery of the stolen assets through large-scale loans and the over-the-counter (OTC) market, the fear caused by the hacking has gripped the market.
According to data from the on-chain analysis platform Defirama on the 24th, the value of Bybit's held assets decreased by about $5.3 billion (about 7.6044 trillion won) after the hacking. Considering that the amount stolen in the hacking was about $146 million, Bybit also suffered a severe 'bank run' where users rapidly withdrew their assets after the hacking incident.
Experts say that what needed to be released has finally been released after the sluggish sideways movement.
The cryptocurrency media Cointelegraph reported on the 24th that Bitcoin's volatility has approached the lowest level in history.
The on-chain data analysis firm Glassnode said, "Bitcoin's weekly realized volatility has dropped to 23.42%, reaching a historical low," and "a sharp change has occurred in the market after a period of low volatility."
The cryptocurrency market, which had been suffering from a sharp selling spree, is rebounding on the morning of the 25th, riding on the low-price buying pressure. As of 9:50 am on the 25th, Bitcoin is trading at 13,456 million won on Upbit.
