The cryptocurrency market sustained a 20.2% dip during February 2025 because investors experienced negative feelings while Bybit endured a $1.5B hack incident as well as memecoins showed less popularity according to Binance Research. Financial markets experienced a downward pressure during this period as NVIDIA (NVDA) and Google (GOOGL) and Amazon (AMZN) saw their stocks decline in value year-to-date. The consumer discretionary industries declined by 6% with information technology registering a decrease of 3% during the same period.
The situation became more volatile as President Trump announced higher 25% trade tariffs on Canadian and Mexican imports which sent global markets into disarray. The United States Treasury yields plummeted abruptly after this regulatory change while Bitcoin together with additional high-risk assets experienced market volatility because of these conditions.
Investors chose protective financial positions following which the market capitalization decreased. During February the world market’s crypto value tanked down from $3.6 trillion to $2.8 trillion resulting in 20% value loss. During February Solana lost $485M worth of assets which moved toward Ethereum along with Arbitrum and BNB Chain. The market shifted funds to Bitcoin causing its dominance percentage to rise 1% until it reached 59.6%. The capital inflow into BNB Chain memecoins had its origin in Binance co-founder CZ using his Twitter account to talk about his dog Brocolli which highlighted the power of social media in shaping speculative cryptocurrency trends.
Real-world assets (RWA) together with stablecoins both achieved their highest levels in the market as they continued to increase despite general market decline.
The total market capitalization of stablecoins went past $224B during a period of 10% steady growth throughout 2025. The market capitalization of RWA reached $17B in 2025 as it grew by 17% in the same timeframe. This growth is attributed to:
Market uncertainties create a rising demand for financial resources like stable assets. The introduction of new stablecoin regulations under U.S. legislation was instrumental for gaining investor trust. The combination of high yields from private credit and RWA investments attracts new investors to maintain their interest levels.
The Ethereum multisig cold wallet breach led to Bybit losing $1.46 billion on February 21, 2025. The cyber attack against Lazarus Group was carried out through the manipulation of a Safe{Wallet} developer by phishing methods.
Key details of the incident:
The system processed more than 350,000 withdrawal requests during this period within a time span of 12 hours. A significant amount of $42.89M in stolen funds was frozen when different crypto platforms joined forces to combat the theft. The excessive breach of Bybit demonstrates unresolved security weaknesses in exchange security systems while underscoring the requirement to boost security throughout exchanges.
Between February 3rd to 28th the crypto and traditional markets remained unstable due to changing macroeconomic forces and security threats that altered investor preferences and market price movements. Two crypto assets recorded higher demand during this period yet risky categories of altcoins and volatile crypto assets experienced net withdrawals from investors’ portfolios.
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