Bitcoin, Ethereum, and Dogecoin: A Tale of Two Crashes and a Bounce Back

Bitcoin, Ethereum, and Dogecoin, three of the most prominent cryptocurrencies, experienced a significant crash and subsequent bounce back today, leaving investors and enthusiasts alike wondering what drove these dramatic price movements. Let's delve into the market dynamics and geopolitical events that contributed to this rollercoaster ride.



The Initial Crash

The initial crash of these cryptocurrencies can be attributed to several factors. Firstly, the growing international trade war led by U.S. President Donald Trump caused a sell-off in the crypto market, with the U.S. stock market also falling from its all-time highs (Forbes, 2025). Secondly, the tariffs on Canada and Mexico set to take effect on March 5, 2025, contributed to the market's edginess and uncertainty (WeFi, 2025). Additionally, a major hack event involving Bybit, a top digital currency trading platform, resulted in over $1.4 billion in Ethereum (ETH) losses. This exploit reversed Ethereum's growth and triggered an unexpected panic in the broader market (CoinGape, 2025).

In the case of Dogecoin, the price drop was influenced by a broader market downturn, with Bitcoin dropping below $84,000, adding to the pressure on cryptocurrencies. Furthermore, the U.S. financial regulator Securities and Exchange Commission's (SEC) guidance on meme coins, published on Thursday, February 10, 2025, contributed to the sell-off. The SEC stated that transactions involving meme coins "do not involve the offer and sale of securities under the federal securities laws," which failed to catalyze a recovery in the category (CoinGecko, 2025).



The Bounce Back

Despite these factors, Bitcoin, Ethereum, and Dogecoin began to recover. For Bitcoin, the recovery was fueled by institutional adoption hype, with Strategy planning a purchase worth $2 billion following its latest private debt offering. Additionally, the nation-state engagement of the coin placed it in the spotlight, with demand exceeding supply (ObvUser, 2025). Ethereum's recovery was influenced by its correlation to Bitcoin, as the BTC flash crash under $80,000 and the subsequent recovery influenced the Ethereum price trend (Coinglass, 2025). Dogecoin's recovery was supported by technical indicators suggesting a potential trend reversal, such as the td Sequential indicator flashing a buy signal on the daily chart (Ali, 2025).

Implications for the Long Term

The regulatory environment, particularly the SEC's guidance on meme coins, had a significant impact on the price movements of these cryptocurrencies. While the guidance provided regulatory clarity and potentially opened the door for increased institutional investment in meme coins, the recent market-wide correction and the decline in Dogecoin price suggest that the market may be more focused on broader economic conditions and market sentiment than regulatory developments.

In conclusion, the crash and bounce back of Bitcoin, Ethereum, and Dogecoin can be attributed to a combination of market dynamics, geopolitical events, and regulatory developments. While the long-term prospects of these cryptocurrencies remain uncertain, the recent price movements serve as a reminder of the volatility and unpredictability of the crypto market. As always, investors should exercise caution and conduct thorough research before making any investment decisions.