$10 Billion Crypto Meltdown: Trump’s 100% China Tariffs Trigger Historic Liquidations
NEW YORK — The cryptocurrency market suffered one of its steepest 24-hour drawdowns on record after President Donald Trump announced the United States will impose an additional 100% tariff on all Chinese imports starting November 1, citing Beijing’s “extraordinarily aggressive” trade posture.
“Starting November 1st, 2025 … the United States of America will impose a Tariff of 100% on China, over and above any tariff they are currently paying,” Trump wrote on his Truth Social account.
Rare-earth flashpoint sparks global risk-off
Earlier in the week, China’s Ministry of Commerce announced sweeping export-license requirements for goods containing more than 0.1 percent rare-earth materials — elements vital for EVs, electronics and defense manufacturing.
Washington’s retaliatory tariff threat sent global markets reeling, reigniting memories of the 2018–2019 trade war.
$9.5 Billion in Positions Erased
Data from analytics firm CoinGlass showed nearly $9.55 billion in leveraged crypto positions liquidated over 24 hours — making it the largest liquidation event in digital-asset history, according to Bloomberg and The Block.
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Bitcoin (BTC): ≈ $1.37 billion liquidated
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Ethereum (ETH): ≈ $1.26 billion
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HTX Exchange: largest single liquidation — $87.53 million BTC/USDT position
Bitcoin plunged from about $122,000 to $104,800, while Ether dropped nearly 12 percent to around $3,200, Reuters reported.
“The altcoin complex got absolutely eviscerated — full leverage reset and market dislocation,” said Zaheer Ebtikar, founder of crypto hedge fund Split Capital, in comments to CoinDesk as liquidation data updated Friday night.
The “Whale” Who Saw It Coming
Blockchain watchers noted a massive short position opened on Hyperliquid just hours before Trump’s tariff post.
While some social-media analysts claimed the trader made roughly $190 million, those figures remain unverified.
Still, the trade’s timing ignited debate over whether large players had advance knowledge of U.S. policy moves — an allegation neither Hyperliquid nor regulators have addressed.
Contagion Fears Ripple Through Finance
Crypto’s total market capitalization sank over 9 percent to $3.8 trillion, erasing nearly $400 billion in paper value in one day.
Analysts warned that cascading margin calls could spread beyond crypto into traditional markets.
“This is how contagion starts,” said a risk strategist at a major U.S. exchange who requested anonymity. “If collateral keeps losing value, funds will sell anything — stocks, commodities, bonds — just to raise cash.”
Bloomberg Intelligence reported early signs of institutional deleveraging, while Wall Street’s S&P 500 fell 2.7% and the Nasdaq lost 3.6% on the same day, their worst performance since April.
Legal Framework: Who Polices Liquidations?
U.S. spot crypto markets — where most forced sales occur — remain largely unregulated at the federal level.
The Commodity Futures Trading Commission (CFTC) oversees crypto futures under the Commodity Exchange Act, but spot exchanges set their own liquidation engines and risk parameters.
“There’s no standardized margin or circuit-breaker regime like we have in equities,” explains Lee Reiners, policy director at Duke University’s Global Financial Markets Center. “When leverage unwinds, there’s nothing legally stopping it.” (Source: Duke University commentary 2024 context)
By contrast, equities operate under Dodd-Frank clearing and capital-buffer rules — structures that prevent such flash-crashes in regulated markets.
Macro Shock Meets Digital Leverage
“Crypto now trades like a high-beta tech stock,” said Mike McGlone, senior macro strategist at Bloomberg Intelligence. “Trump’s tariff shock didn’t just hit commodities — it punctured confidence across every speculative asset class.”
What Comes Next
If Trump delays the tariffs or Beijing relaxes its export controls, analysts expect a relief rally — though the $10 billion liquidation hole leaves lingering scars.
“Those positions don’t come back,” Ebtikar added. “This resets the derivatives landscape completely.”
As of early Saturday, Bitcoin hovered near $111,000 with funding rates deeply negative — a sign traders are paying premiums to short.
Telegram groups and X threads filled with screenshots of wiped accounts under the tag #BlackFridayForDegens.
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