The crypto market experienced its most massive liquidation event ever, with over $19 billion in futures positions wiped out in a single day. Across the board, crypto assets plummeted, wiping out roughly 9% of the market capitalization within 24 hours.
This historic sell-off coincided with US President Donald Trump’s announcement of new 100% tariffs on Chinese imports, which he posted on Truth Social, alongside potential export restrictions on “critical software.” The tariffs are set to take effect from November 1 or earlier, according to the announcement.
What Happened?
The crash was triggered by escalating tensions in the ongoing US-China trade saga. Trump’s measures were framed as a response to China’s broad export restrictions, particularly affecting rare earth metals crucial for chip manufacturing and high-performance equipment.
Earlier this year, China had already tightened controls over the export of these materials, a move that significantly impacts global tech supply chains.
Market Reaction
Traditional markets felt the shock as well:
- S&P 500 fell 2.7%, marking its largest drop since April.
- Dow Jones declined 1.9%.
- Nasdaq slid nearly 3.6%.
However, the crypto market reaction was even more dramatic. Bitcoin briefly dropped to $102,000, while altcoins suffered deeper losses:
- Ethereum fell to $3,700 (-14% daily)
- Solana dropped below $175
Some coins have regained a fraction of their losses, but overall market capitalization remains nearly 10% lower, according to CoinMarketCap.
Historic Liquidations
According to Coinglass, more than 1.6 million trader positions were forcefully closed, with longs accounting for $16 billion of the total $19 billion.
- Hyperliquid recorded the largest platform-level liquidation at $10.3 billion.
- The single biggest trader loss exceeded $203 million.
Coinglass notes that these figures may still underestimate total losses, as not all exchanges report real-time liquidation data. For instance, Binance publishes only one liquidation order per second.
High trading volume caused some exchanges to experience intermittent outages, further amplifying market stress.
Sentiment on the Market
The Fear & Greed Index dropped to 35, indicating a market dominated by fear and uncertainty as traders process one of the largest liquidation waves in crypto history.
