A Rough Week for Crypto Markets
If you’ve been in the crypto space long enough, you know the market can be unpredictable. But this past week has been exceptionally brutal. A record-breaking $1.4 billion hack at Bybit, Bitcoin’s 20% price drop, and political attacks on Tether (USDT) have left investors rattled. Meanwhile, Bitcoin mining stocks and crypto-related companies have seen sharp declines, adding to the negative sentiment.
Bybit Hack: The Largest in Crypto History
On Feb. 21, Bybit suffered a $1.4 billion exploit, marking one of the biggest hacks in cryptocurrency history. Investigations pointed to the Lazarus Group, a North Korean hacking collective known for high-profile crypto thefts. The attack targeted Bybit’s staked Ether wallets, taking advantage of compromised credentials from Safe(Wallet), a digital asset management tool.
Bybit’s CEO, Ben Zhou, quickly addressed the situation, declaring “war” on the hackers and assuring customers that their funds were secure. The exchange claimed it is now operating at 100% reserves and is taking steps to prevent future attacks.
However, the incident has shaken trust in centralized exchanges, reinforcing concerns about security risks even on major platforms. The industry is once again reminded that self-custody of assets is the safest option.
Bitcoin’s Price Crashes Over 20%
The Bitcoin (BTC) price plunged more than 20% from its recent all-time high, leaving traders worried about further corrections. The drop has been attributed to several factors, including:
- Macroeconomic concerns: U.S. President Donald Trump’s proposal of 25% tariffs on imports from Canada and Mexico has created uncertainty in financial markets, including crypto.
- Crypto liquidations: A high volume of leveraged trades led to massive liquidations, pushing Bitcoin’s price lower.
- Correlation with equities: Bitcoin proxy stocks also took a hit as traditional markets struggled.
Despite this, long-term Bitcoin holders remain unfazed. Market analysts suggest that corrections like these are normal after a rally and could present a buying opportunity.
Bitcoin Mining Stocks Take a Hit
With Bitcoin’s price falling, mining companies have felt the pressure, particularly those that struggled to adapt after the 2024 halving. Bitdeer Technologies and Cipher Mining both saw their stock prices tumble after reporting poor Q4 earnings.
- Bitdeer’s stock plunged over 25%, citing weak revenue performance due to the halving.
- Cipher Mining lost 17%, with operational losses more than doubling year-over-year.
The halving event reduced mining rewards by 50%, squeezing profit margins for mining firms. Unless Bitcoin’s price stabilizes or rises, miners could continue to face financial pressure.
Michael Saylor’s Strategy Stock Declines
MicroStrategy (MSTR), the biggest corporate holder of Bitcoin, has also been affected. The company’s stock has fallen 16% since the beginning of the year, mirroring Bitcoin’s price movement.
MicroStrategy has built its business model around acquiring Bitcoin, raising capital to increase its holdings. While this strategy has worked well in bullish periods, it exposes the company to significant downside risks when Bitcoin drops.
Despite recent losses, MicroStrategy remains committed to its Bitcoin strategy, adding another 20,356 BTC worth $1.99 billion to its treasury.
Tether Under Political Fire
Tether (USDT), the world’s largest stablecoin with a market cap of over $140 billion, is facing increasing scrutiny. Paolo Ardoino, Tether’s CEO, claims that politicians are actively trying to destroy the company.
According to Ardoino:
- Certain political and financial figures are making efforts to push Tether out of the market.
- Instead of competing with USDT, they want to eliminate it altogether.
- Ironically, USDT is one of the strongest tools for U.S. dollar dominance in emerging markets.
Tether remains a crucial part of the crypto ecosystem, providing liquidity and stability. If regulators successfully crack down on USDT, it could have major consequences for crypto trading and DeFi markets worldwide.
What’s Next for Crypto?
This past week has been a reminder of crypto’s volatility and risks, but also its resilience.
- Bybit’s hack underscores the importance of security and self-custody.
- Bitcoin’s correction could be an opportunity for long-term investors.
- Tether’s regulatory battle is a sign that stablecoins remain a key focus of governments.
While short-term uncertainty looms, crypto’s long-term adoption and innovation continue to push forward. Savvy investors should stay informed, manage risk, and look for strategic opportunities in the chaos
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