Jonathan Castroviejo - who had led the race after Movistar's win on stage 1 - Adriano Malori and Valverde all fell less than 20 kilometres from the finish in a crash caused for unclear reasons on the right hand side of the road.
None of the three suffered major injuries, and Valverde was able to get up and return to the peloton so quickly TV images did not show he had fallen. However, after that, he was well towards the back and badly placed when the fast-moving peloton tackled the final uphill climb.
As a result Valverde could not participate in a sprint which on paper suited him well, and he lost seven seconds in a late split. As a result, he had no chance of defending the leader's jersey, either.
"I hit a teammate's bike and hit my back, but I could recover and go ahead," Valverde said afterwards.
"I started the climb well behind and because of that, I'm happy with the time I lost. Seven seconds is nothing. My back hurts a bit after the crash, but I hope it's not serious and I can recover well."
"I'm not feeling really sad after losing the jersey - it was more that I wanted to win this stage. I couldn't, but this is cycling, things like that happen and we must carry on."
Valverde is now third overall, at 11 seconds, whilst teammate Nairo Quintana moves up to second, at four seconds behind race leader Michael Matthews (Orica-GreenEdge)