The market encountered a sharp sell-off driven by escalating macroeconomic concerns, particularly after President Donald Trump reaffirmed his plans to implement 100% tariffs on Chinese imports.
In just 24 hours, over 1.66 million cryptocurrency traders faced liquidations, leading to a staggering loss of $19.33 billion across positions, as reported by CoinGlass.
Key Takeaways:
More than 1.66 million traders were liquidated in a single day, resulting in $19.33 billion disappearing from crypto positions.
Bitcoin and Ethereum suffered the most, accounting for liquidations of $5.38 billion and $4.43 billion, respectively.
Analysts warn that this event represents one of the largest deleveraging episodes of the year.
The drastic sell-off was fueled by increasing macroeconomic woes, further exacerbated by President Trump’s confirmation of 100% tariffs on Chinese imports, unsettling risk-sensitive markets.
Bitcoin and Ethereum Contribute to $16.8B in Long Losses
Long positions took the hardest hit, accumulating losses totaling $16.83 billion, while shorts accounted for $2.49 billion.
Bitcoin and Ethereum led the pack with liquidations of $5.38 billion and $4.43 billion, respectively, followed by Solana at $2.01 billion and XRP at $708 million.
A significant incident occurred when Hyperliquid reported the largest single liquidation, involving an ETH-USDT position valued at $203.36 million. Overall, total liquidations across all exchanges exceeded $10.3 billion.
Experts noted that this incident reflects one of the year’s most severe deleveraging events, highlighting the persistent volatility in the cryptocurrency market.
Global cryptocurrency market capitalization dropped by over 9% within 24 hours, falling to $3.8 trillion as major asset prices plummeted.
Bitcoin fell from above $122,000 early Friday to approximately $113,600, erasing all gains made since August, and momentarily dipped below $102,000 that evening.
The situation deteriorated further after Trump issued warnings of substantial tariff hikes on Chinese goods, following Beijing’s new export restrictions on products with over 0.1% rare earth elements.
Trump reiterated his plans for the 100% tariffs but indicated a possible reversal if China changes its position before November 1.
Analysts suggest that if the tariffs are reconsidered, it could potentially trigger a short-term rebound in crypto markets, although the losses from liquidations are already substantial.
Interestingly, a prominent trader on Hyperliquid reportedly shorted Bitcoin and Ethereum positions worth nine figures, amassing an estimated profit of $190 million. On-chain analyst @mlmabc speculated that this trader may have played a role in Friday’s crash.
Trump’s Approval Rating Hits New Low Amid Government Shutdown
President Donald Trump’s approval rating has significantly declined, with only 40% of Americans approving of his performance while 58% disapprove, according to a recent Reuters/Ipsos poll.
This drop follows mounting backlash against his decision to militarize law enforcement. Another HarrisX survey revealed a slightly higher approval rating at 46%, emphasizing a deep partisan divide in the nation.
This decline coincides with an ongoing government shutdown brought about by Congress’s failure to approve spending bills by the October 1 deadline.
Trump has attributed the blame to Democrats, stating he will target their programs in future budget cuts. Furthermore, 86% of traders on the Polymarket prediction platform believe the shutdown will extend beyond October 15, reflecting waning confidence in Washington’s ability to broker a deal.
Trump’s pro-crypto stance, a focal point of his 2024 campaign, is also under scrutiny.
Senator Elizabeth Warren has voiced concerns that Trump’s involvement in cryptocurrency could result in ethical issues if he profits from related initiatives during his presidency.
