See: https://spacenews.com/spacex-crew-dragon-spacecraft-suffers-anomaly-during-ground-tests/
Grainy footage: https://www.youtube.com/watch?v=scz-fFZT-dI
This is really unfortunate. Alongside Boeing's struggles with Starliner, this has irrevocably put back NASA's commercial crew program from launching humans to space from American soil by at least another 6 months, if not a year or more.
A thought: Dragon uses hypergolic fuel, which (correct me if I'm wrong) I believe is very unstable, so this may have been causes by something as minor as a fuel line leak. The explosion occurred at T -8 before a test fire, so it's unlikely that it was an engine fault per se.
Another thought: This is the same Crew Dragon that was launched on the uncrewed DM-1 test earlier this year. If it turns out that this fault was an issue brought about by reuse (say by salt water intrusion), that will certainly require design changes, but may allow flights of new Crew Dragons to progress unhindered.