The Nikkei is down 2.1% to 14,902, as a strong yen weighed on stocks, and on profit taking.
"The Nikkei is down 2% as risk aversion radiates and propagates from China to Asia," Societe Generale's Sebastien Galy wrote in an email to clients.
Here's a look at the stunning sell-off:
Meanwhile, copper continues to plunge and it's a sea of red in Asia.
Hong Kong's Hang Seng is down 1.5%.
China's Shanghai Composite is down 0.3%.
Australia's S&P/ASX 200 is down 1.1%
China already experienced its first domestic bond default last week, and now markets are concerned that electrical equipment and solar panel maker, Baoding Tianwei Baobian Electric, will be the next domino to fall.