US stocks plunged 4 trillion, the crypto market "collectively plummeted", where will the market go in the future

Author: Spirit, Golden Finance

On March 10, 2025, the global financial market suffered a severe shock. The U.S. stock market has lost $4 trillion in market value due to panic selling triggered by Trump's tariff policy, and the shadow of recession is looming. At the same time, the cryptocurrency market was not spared, with mainstream currencies such as Bitcoin and Ethereum plummeting across the board.

Cryptocurrency markets “slumped collectively”: panic spreads 

As of 9:00 a.m. Beijing time on March 11, the cryptocurrency market in the past 12 hours was shrouded in a haze, which can be described as a “collective slump” and “across-the-board crash.” Panic sentiment in the market has increased significantly. According to Coinglass data, more than 210,000 people have had their positions liquidated in the past 24 hours, with the amount of liquidation reaching US$924 million. The value of the largest single liquidation order exceeded US$32 million. The market has undergone a drastic deleveraging process.

Specifically, the price of Bitcoin continued to fall, once falling below the key mark of $77,000. Bitcoin has fallen more than 4%-5% in the past 12 hours. Ethereum's decline was even more severe. Coinbase data showed that it plummeted by more than 13% in the past 24 hours. Other mainstream currencies and altcoins such as ADA, SOL, and DOGE also suffered heavy losses, with some currencies even falling by more than 10%-12%.  

The “Big Earthquake” in the U.S. Stock Market: Trump’s Tariff Policy Triggered Market Panic

The U.S. stock market suffered its worst single-day plunge since 2025, with the market value evaporating $4 trillion in an instant, which can be called a “big earthquake.” The S&P 500 index fell 2.7% in a single day, the biggest drop of the year; the Nasdaq index plummeted 4%, the biggest single-day drop since September 2022. The market value of the seven technology giants evaporated by more than US$750 billion. Tesla's stock price collapsed by more than 15%, marking its worst single-day performance since 2020.

The “trigger point” of market panic points directly to the Trump administration’s tariff policy. Tariff measures against major trading partners such as Canada, Mexico and China have raised deep concerns about an escalating trade war and a global recession. Ayako Yoshioka, senior investment strategist at Wealth Enhancement, pointed out sharply that market sentiment has shifted dramatically and strategies that once worked are no longer applicable.

Multiple factors superimposed: Analyzing the deep reasons for the market crash 

The stock and currency markets have both plummeted this time, which is the result of the superposition and resonance of the following multiple risk factors: 

1. Trump’s tariff policy and the shadow of trade war: The Trump administration’s tariff policy is the most direct fuse that triggered the market panic. The tariff policy not only directly impacts corporate profits, but also exacerbates global trade tensions and triggers investors' concerns about an economic recession.  

2. Rising expectations of economic recession: The negative impact of tariff policies, coupled with the risk of a global economic downturn, has significantly increased market concerns about an economic recession. U.S. Treasury yields fell sharply and the Cboe Volatility Index soared to its highest level since August, both reflecting investors' extreme anxiety.

3. Overvaluation of technology stocks and profit-taking: In the past two years, technology stocks and large-cap stocks have been the main engines of market growth, accumulating huge gains and valuations are at historical highs. The market crash was also due to the valuation correction of technology stocks and concentrated selling by profit-taking.  

4. The cryptocurrency market’s own correction demand: The cryptocurrency market has also experienced a round of rapid growth recently. The price of Bitcoin once approached its historical high. The market itself has a demand for technical adjustments and profit-taking, and external risk events have accelerated the correction process.  

Market Outlook: Short-term volatility intensifies, long-term outlook remains unclear 

Looking ahead to the market, global financial markets, including the cryptocurrency market, may continue to experience sharp fluctuations in the short term. Investors need to be alert to the following risks:

1. Market panic may continue: The direction of the Trump administration's tariff policy is still unclear, and the risk of a trade war may continue to ferment. Market panic will be difficult to dissipate quickly in the short term.  

2. U.S. stocks may face further downside risks: Evercore ISI analysts warned that intensified stagflation concerns, tariff policies and economic uncertainties may cause the S&P 500 index to fall further, and may even fall to a pessimistic scenario of 5,200 points. The Nasdaq index has entered a technical correction zone, and bear market risks are approaching.

3. The cryptocurrency market may be under pressure: Against the backdrop of rising global risk aversion, the cryptocurrency market will find it difficult to remain immune and may continue to be dragged down by downward pressure from external markets, and may continue to fluctuate and adjust in the short term.  

4. Be wary of “black swan” events: The current global economic and geopolitical environment is complex, and sudden “black swan” events may still occur in the future, further exacerbating market volatility.  

In the long run, there is still great uncertainty about the future direction of the cryptocurrency market and traditional financial market. On the one hand, technological innovation, policy shifts and application expansion will continue to bring long-term growth potential to the cryptocurrency market; on the other hand, factors such as macroeconomic downward risks and the US government's economic policies will also constrain its long-term development.  

Non-investment advice:

In the face of the current turbulent market environment, investors should maintain a cautious and optimistic attitude and adopt the following strategies:

• Control positions and reduce leverage: During periods of severe market fluctuations, positions should be reduced, excessive leverage should be avoided, and risks should be strictly controlled.

• Focus on safe-haven assets: When risk aversion in the market heats up, you can appropriately allocate safe-haven assets such as gold and bonds to hedge risks.

• Select high-quality targets: Whether it is stocks or cryptocurrencies, we should adhere to the concept of value investment and select high-quality targets with good fundamentals and long-term growth potential.

• Pay close attention to market trends: Pay close attention to the global macroeconomic situation, policy changes and market sentiment, and adjust investment strategies in a timely manner.

• Do a good job of risk management: Both the cryptocurrency market and the stock market are high-risk. Investors must fully understand the risks, do a good job of risk management, and avoid blindly chasing ups and downs.  

The global market crash on March 10, 2025 is the result of the resonance of multiple risk factors, indicating that market volatility may increase in the future. Investors should remain vigilant, respond prudently and seize long-term investment opportunities.