A global shocking scene: Japan and South Korea both hit the circuit breaker! Multiple cross-border ETFs hit the limit, 330,000 virtual currency positions were liquidated, and more than 1 billion US dollars were wiped out.

Hit by weak US employment and economic data, coupled with the soaring yen and geopolitical tensions in the Middle East, the confidence of global investors was frustrated. On Monday (August 5), global stock markets staged a thrilling scene.

Raising interest rates and shrinking balance sheets are naturally bad for the stock market. Japan's debt ratio exceeds 200%. Once it chooses to raise interest rates, problems with Japanese debt are likely to follow. Even if the interest rate is only increased by 15 basis points this time, and the balance sheet is still expanded, the market still does not buy it. Raising interest rates can slow down the decline of the yen, but it also restricts economic development.

In addition, analysts believe that because the latest US economic data is lower than expected, investors are worried that the US economy will fall into recession, and panic sentiment is pervasive in the market.

The cryptocurrency market collapsed, and nearly 330,000 people were liquidated.

On August 5, the cryptocurrency market also experienced a round of sharp declines. Among them, Ethereum crashed during the session, plummeting by more than 26% and falling below $2,084.69 per coin; Bitcoin once fell below $50,000 per coin during the session, reaching a low of $489,343,800 per coin, a drop of more than 22%.

Some analysts pointed out that the sharp drop in cryptocurrencies is related to multiple factors: First, geopolitical tensions in the Middle East have intensified, and market risk aversion has increased significantly; second, a series of key economic data released by the United States recently have been disappointing, and the market is worried that the US economy will fall into recession, which has also triggered a wave of selling in US and Japanese stocks; third, the uncertainty of the US election has increased; fourth, the US government may sell a batch of seized crypto tokens in the near future, and there is a risk of oversupply of tokens returned to creditors through bankruptcy procedures.

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