Due to the market’s growing instability, on 7 April 2025, Ethereum tumbled to $1450, marking a 20% drop and its lowest since late 2023. Bitcoin mirrored Ethereum’s price drop by falling 10% to $74,700, and the GMCI 30 index that tracks top crypto tokens also fell by 8.6%.
The cryptocurrency market is facing severe headwinds at the moment. In just the last 24 hours, traders liquidated $890 million, $758 million of which came from long positions and $133 million from short positions.
What happened in crypto last week?
• Bitcoin trades at $77,000
• Ethereum trades at $1,400
• Global stock markets drop on Trump’s tariff war, crypto follows
• China’s stock market sees its biggest crash since 2008
• Strategy adds 22,048 BTC for $1.92B
• Metaplanet… https://t.co/h0o5zLR1dm
— Cryptopolitan (@CPOfficialtx) April 7, 2025
Analysts have chalked up the market volatility to escalating trade tensions and policy uncertainties, with the Guardian on 7 April 2025 noting that Wall Street may enter a bear market based on the signals received from the futures market.
Jeff Mei, COO at cryptocurrency exchange BTSE, stated, “Historically, crypto markets tend to front-run stock markets over the weekend, and this morning’s Asia market declines seem to have reinforced this belief.”
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Ethereum, Bitcoin Closely Tie Performance To Asian Equity Market
The interconnectedness between traditional equity markets and cryptocurrency has been evident for some time, and this decline in the stock market has had a cascading effect on the crypto landscape as well.
Overlapping with the crypto falloff, the Asian stock market saw a dramatic decline, with Japan’s Nikkei 225 plummeting by 8%, while South Korea’s Kospi and China’s Shanghai Composite fell by 4.6% and 5.8%, respectively. Also, Taiwan’s market, since reopening after a break, saw over 1000 stocks hit limit down.
According to a blog post by the IMF, major cryptos such as Bitcoin and Ethereum have gradually tied their performance closely to the Asian equity market. The blog post emphasizes that regulators need to put in place measures to mitigate financial stability risks, as the volatility correlations between digital assets and the Asian market have increased threefold since 2020.
Peter Chung, head of research at Presto, noted that the risk sentiment has reversed due to the US’s tariff escalation and that traders, in a bid to move away from risky assets, are pulling liquidity from established digital assets like Ethereum.
With traders exiting, the crypto landscape is witnessing volatility that it has not experienced for quite some time. Many altcoins are undergoing double-digit declines along with blue-chip coins, underscoring the severity of the market decline.
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Is A Crypto Rebound Possible?
According to Chung, recovery hinges on three key elements: the global community’s response, the Trump administration’s ability to present a clear and long-term strategy, and the Federal Reserve’s anticipated measures to stabilize the current market conditions.
Chung emphasizes, “The Growth Scare 2.0 is in full swing, with markets now pricing in over 100 bp rate cuts this year.”
Alankar Saxena, CTO and co-founder of Mudrex, an Indian crypto exchange, commented, “Bitcoin continues to show resilience, trading at $83,000, despite the volatility fueled by Trump’s reciprocal tariffs.” However, Ethereum faces concerns over growing supply and impending hyperinflation, which have alarmed investors.
Elaborating on the situation of overselling that the crypto landscape currently faces, Nick Ruck from LVRG Research says, “This could lead to an overselling of digital assets, which take significant influence from ever-changing sentiment and their own ecosystem economics, such as tokenomics and Bitcoin mining.”
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Key Takeaways
Ethereum drops to $1,450, marking its lowest price since late 2023.
$890M in crypto liquidations reflect growing market instability and trader uncertainty.
The volatility correlations between digital assets and the Asian market have increased threefold since 2020.
