Bitcoin News Today: Dormant Whales and Tariff Fears Trigger $5B Crypto Liquidation Wave

The cryptocurrency market experienced a significant selloff in late October 2025, with total liquidations exceeding $5 billion as Bitcoin briefly fell below $107,000. The downturn was triggered by a combination of large-scale Bitcoin movements from dormant wallets and geopolitical tensions stemming from U.S. President Donald Trump's tariff threats against China.

A pivotal event occurred on October 7, when a $3.93 billion Bitcoin transfer from wallets inactive for 3–5 years sent shockwaves through the market. This "whale awakening" led to $620 million in liquidations, primarily affecting long positions (74% of total liquidations), and caused Bitcoin to drop 4% to approximately $120,000 Whale Awakening: $3.9 Billion Bitcoin Shift Triggers $620 Million Liquidations^[1]. The move highlighted the market's sensitivity to large-scale transactions and the influence of long-term holders in shaping price dynamics.

The volatility intensified on October 10 as Trump announced plans for a 100% additional tariff on Chinese imports, escalating trade tensions. This triggered a broader market crash, with Bitcoin falling below $110,000 and Ethereum (ETH) plummeting 16% to $3,700. Liquidations surged to $770 million in 24 hours, with $613 million from long positions . Over 200,000 traders were affected, and altcoins like Solana (SOL) and XRP suffered double-digit declines.

The liquidation data underscores the role of leveraged trading in amplifying market movements. During the October 10 crash, $824 million in leveraged positions were liquidated, with Bitcoin accounting for the largest share. Analysts noted that such events act as "market resets," removing excessive leverage but also exposing vulnerabilities in the ecosystem . The cascading liquidations were exacerbated by thin liquidity and heightened macroeconomic uncertainty, including fears of a U.S. government shutdown and inflation concerns.

Bitcoin's price action revealed critical technical levels. The $120,000 support became a focal point after the initial sell-off, while Ethereum's breakdown below $4,100 signaled further bearish pressure. On-chain analytics indicated that large holders were likely profit-taking, given the astronomical gains accumulated by early Bitcoin investors Whale Awakening: $3.9 Billion Bitcoin Shift Triggers $620 Million Liquidations^[1]. Meanwhile, altcoins faced widespread declines, with some meme coins like Dogecoin (DOGE) and Shiba Inu (SHIB) dropping over 15% in 24 hours $770M Liquidations Hit the Market as Trump Threatens More Tariffs on China^[4].

The market's response to these events was mixed. While some viewed the liquidations as a necessary correction to stabilize leverage ratios, others warned of prolonged volatility if trade tensions persisted. Institutional adoption and regulatory clarity were cited as potential catalysts for recovery, though immediate sentiment remained fragile.