Powell's speech in the early morning caused the cryptocurrency market to collapse instantly!
Summary of reasons:
Impact of Powell's speech: Emphasized the Federal Reserve's confidence in the inflation target, stated that tightening policies are effective, mentioned changes in the labor market and the timing of policy adjustments, stock market is positive but the cryptocurrency market is impacted.
Issues within the cryptocurrency market: Plummeting of LUNA and other coins, excessive collateralization in DeFi lending, high leverage investments, misappropriation of funds leading to liquidity crises and a death spiral in institutional funds, exacerbating panic.
Regulatory factors: The SEC's investigation into Coinbase's trading situation undermines market confidence.
Overall characteristics: The cryptocurrency market itself is highly volatile, and regulatory policies are uncertain, with varying attitudes among countries, increasing instability.
Despite facing many challenges, the blockchain technology it relies on has broad application prospects, and more application scenarios are expected to emerge in the future.