Analysis: The main reasons for the recent crypto market crash are the Bank of Japan hinting at an interest rate hike and market concerns over potential "blowups" in strategies.

BlockBeats News, December 2, Bitcoin briefly fell below $84,000, dropping more than 8% at one point. The total crypto market cap fell below $3 trillion. In the past 24 hours, liquidations across the network reached $974 million, with long positions accounting for $851 million, and over 260,000 traders were liquidated. Regarding this crypto market crash, Arthur Hayes posted that the reason was the Bank of Japan hinting at a possible rate hike in December. The USD/JPY exchange rate fluctuated in the 155-160 range, indicating a hawkish stance from the Bank of Japan. Threshold Network co-founder Maclane Wilkison stated, "The Bank of Japan signaling an imminent rate hike has tightened global liquidity expectations and shaken risk assets."

In addition, Strategy CEO Phong Le stated that the company would only consider selling Bitcoin if the company's stock price falls below net asset value and it is unable to obtain new funding. The market is concerned that due to the weakening Bitcoin price, Strategy may be forced to sell coins because of a lack of cash to pay dividends.

Previously, S&P Global Ratings downgraded Tether's USDT stability rating from "constrained" to "weak," warning that a drop in Bitcoin prices could lead to under-collateralization risks for the stablecoin. Arthur Hayes posted that if the "gold + BTC position" drops by about 30%, it would wipe out their equity capital, and then USDT would theoretically become insolvent. In response, Tether CEO Paolo Ardoino posted regarding "Tether FUD," stating that the group's own equity is close to $30 billions. S&P did not take into account the group's additional equity in its analysis, nor did it consider the approximately $500 million in monthly base profit generated solely from US Treasury yields.

Boris Revsin, General Partner and Managing Director at Tribe Capital, described this as a "leverage washout," which triggered a chain reaction across the market. At the same time, the macro environment has become less favorable: short-term rate cut expectations have faded, inflation remains stubborn, the job market is weakening, geopolitical risks are rising, and consumer pressure is increasing. This series of factors has led to most risk assets performing weakly over the past two months. Cardiff founder William Stern stated: "With just over a week until the Federal Reserve meeting and inflation data still unclear, institutional investors are actively reducing risk. They are unwilling to hold highly volatile assets like Bitcoin to avoid hawkish remarks from Powell."