Crypto Assets market capitalization has evaporated 1.2 trillion USD in eight weeks — is this reset necessary?

Due to the explosion of extreme leverage effects, the crypto assets market evaporated over $1.2 trillion in just eight weeks. Analyst Shanaka Perera referred to it as a “well-orchestrated crash” rather than a real crash. Despite the severe blow to the market, the adoption of crypto assets soared to 560 million users, with growing interest from institutional investors, as firms like BlackRock and MicroStrategy hold over 1 million Bitcoins. Furthermore, regulatory initiatives such as GENIUS and CLARITY have also promoted increased regulatory transparency. Although liquidations triggered by leverage reached $19 billion in a single day, the fundamentals remain strong, with DeFi lending reaching $39 billion and the tokenization of real-world assets exceeding $8 billion, laying the groundwork for a potential market recovery.