Bitcoin dropped below $90,000 on Tuesday, reaching its lowest level since November amid fallout from a $1.5 billion Bybit hack and renewed worries about U.S. tariffs. The world’s leading cryptocurrency fell by up to 7.5% during the day, trading at $87,169.76. This decline is part of a broader sell-off in digital assets, with Ether—the second-largest cryptocurrency—also falling by 8.46% to $2,414.29, its lowest level since October.
The sharp downturn follows last week’s cyberattack on Bybit, the world’s second-largest cryptocurrency exchange, which resulted in the theft of digital tokens worth around $1.5 billion. Blockchain analytics firm Elliptic described the incident as “almost certainly the single largest known theft of any kind in all time.”
Investor sentiment has further been dampened by concerns over U.S. economic policies. Former President Donald Trump announced on Monday his plans to impose a 25% tariff on imports from Canada and Mexico starting in early March. This uncertainty has pushed investors toward safe-haven assets, with U.S. Treasury yields falling to two-month lows.
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Marcel Heinrichsmeier, a crypto assets analyst at DZ Bank, attributed Bitcoin’s recent price decline mainly to broader macroeconomic factors. He noted that the Bybit hack, combined with recent memecoin turmoil, has weakened market sentiment compared to earlier in the year.
Smaller cryptocurrencies have seen even steeper losses, with tokens like Dogecoin and those from the Solana and Cardano networks plunging by about 20%, according to CoinGecko data.
Charles Wayn, co-founder of the decentralized blockchain platform Galxe, commented that the significant sell-off was expected in light of the unprecedented hack, and that fears over global tariffs have only exacerbated market declines.
Although the Bybit hack was disclosed last week, analysts suggest that Tuesday’s price drop represents a delayed market reaction. Joseph Edwards, head of research at Enigma Securities, explained that while the market initially withstood the impact, a subsequent drop in risk appetite triggered a cascading sell-off.
Bybit CEO Ben Zhou confirmed that the stolen funds were taken from a “cold wallet,” an offline storage solution intended to enhance security. The breach, which primarily affected Ether tokens, has shaken investor confidence in crypto security measures, leading some to exit the market.
Adding to the pressure, Bitcoin-backed exchange-traded funds (ETFs) have experienced significant outflows in recent weeks. Data from LSEG indicates that the largest crypto ETFs are on track for net monthly withdrawals of approximately $644 million—the highest since their launch in January 2024.
Thomas Erdosi, head of product at CF Benchmarks, noted that a few months ago there was optimism about a strategic Bitcoin fund and relaxed regulations, which had investors expecting a price surge. However, with little progress on regulatory clarity or new catalysts, Bitcoin has remained range-bound.
Despite the current selloff, some analysts believe that Bitcoin could rebound if macroeconomic conditions improve and regulatory clarity is achieved, though short-term volatility is expected to persist. With Bitcoin slipping below key technical levels, traders will be watching upcoming economic data and policy announcements closely to determine the next market direction.
Bitcoin’s fall below $90,000 underscores the fragile state of the crypto market as investors navigate security concerns, regulatory uncertainty, and global economic shifts. While long-term supporters remain optimistic, the coming weeks will be crucial in deciding whether Bitcoin can regain its bullish momentum or face further declines.
