Crypto Carnage: $9 Billion Wiped Out as Bitcoin Plunges 10% Following Trump’s China Tariff Shockwave
Digital assets face brutal reckoning as geopolitical tremors rattle markets
The Massacre Unfolds
Liquidation waves crashed across crypto exchanges, wiping out positions with ruthless efficiency. Margin calls triggered cascading sell-offs as Bitcoin's 10% nosedive vaporized $9 billion in leveraged bets. The bloodletting exposed the market's fragile underpinnings—too much hot money chasing too few fundamentals.
Trump's Tariff Tinderbox
Former President Trump's proposed 100% tariffs on Chinese goods ignited the panic. Global risk assets recoiled as traders priced in potential economic warfare. Cryptocurrencies, despite their decentralized aspirations, proved just as vulnerable to old-school political brinksmanship. The 'digital gold' narrative tarnished faster than you can say 'trade war.'
Market Mechanics Exposed
Over-leveraged positions magnified the downturn, creating the perfect storm. When Bitcoin broke key support levels, automated systems kicked in—selling begetting more selling. The very mechanisms designed to protect investors instead accelerated their demise. Another reminder that in crypto, the house always wins—even when there's no physical house.
Silver Linings or Fool's Gold?
History suggests violent corrections often create buying opportunities for those with dry powder. But this time feels different—the geopolitical stakes are higher, the leverage more extreme. Maybe this is the wake-up call the space needs. Or maybe it's just another Tuesday in the casino that never closes.
Wall Street's finest would call this 'price discovery'—everyone else calls it getting rekt.
The move, which stoked fresh alarms over an escalating U.S.-China trade war, sent Bitcoin (BTC) spiraling more than 15% to a session low of $105,896, its sharpest drop since early 2025, before a tentative recovery lifted it back toward $113,600, leaving more than 1,514,388 traders nursing massive losses in one of the sector's most brutal unwinds.
What began as a late-session liquidity squeeze rapidly escalated into a full-blown cascade after Trump's tariff declaration targeted critical Chinese rare earth exports, vital for global tech supply chains, colliding with overextended long positions and dwindling ETF inflows.
On-chain analytics from Coinglass revealed the carnage's scale, with the platform logging the single largest wipeout, a $87.53 million BTC-USDT order, amid a frenzy that briefly overwhelmed tracking systems and echoed the chaos of the 2020 COVID crash.
The 24-hour liquidation tally, predominantly longs at over 90%, underscored the market's vulnerability to macroeconomic jolts, as Bitcoin's dominance surged while capital stampeded toward safer havens.
The rout inflicted disproportionate pain on altcoins, amplifying Bitcoin's downside in a classic risk-off flight. ethereum (ETH), often viewed as a high-beta bellwether, led the blue-chip implosion with an intraday plunge of up to 18% before settling around a 12% daily loss, as DeFi protocols saw volumes evaporate overnight.
Solana (SOL) wasn't far behind, cratering 22% in the melee, while XRP tumbled a steep 25% on whispers of regulatory Ripple effects from the trade spat.
Among large-cap standouts, Dogecoin (DOGE) endured the harshest blow, slashing 39% to scrape $0.09 lows amid retail panic selling, though its meme-driven faithful swiftly rallied around historical October rebound patterns that have delivered average gains exceeding 400% in past cycles.
This perfect storm of geopolitical saber-rattling, weekend positioning woes, and forced deleveraging has traders on edge, with bitcoin now testing $100,000 as a key support level ahead of potential weekend escalations.
"It's a textbook leverage purge," one prominent X analyst observed, highlighting how thin order books exacerbated the slide.
While the immediate dust is settling, ETH ETF inflows showed faint signs of rebounding, the episode lays bare crypto's deepening ties to global trade frictions, even as institutional adoption accelerates.
