Bitcoin News Today: Leverage Fuels Crypto's Record Liquidations; Bitcoin Bounces as Trade Fears Ease

Bitcoin clawed back 46% of its losses following a sharp rebound in early trading after U.S. President Donald Trump hinted at potential de-escalation in trade tensions with China, calming global markets. The cryptocurrency had plunged nearly 12% to a low of $109,000 on October 10 amid fears of a U.S.-China trade war triggered by Trump's announcement of a 100% tariff on Chinese imports and export controls on critical software. By October 13, Bitcoin had regained ground to trade above $115,000, signaling a partial recovery from the record $19.38 billion in liquidations recorded during the prior 24-hour period Bitcoin Rebounds After Trump China Tariffs Trigger Crypto Sell ...^[4].

The initial sell-off, described as the largest liquidation event in crypto history, saw over 1.6 million traders wiped out, with Bitcoin's price collapsing from a record $126,200 to below $105,000 within hours Bitcoin Crashes Below $120k as Trump Raises Tariff to China^[1]. Ether (ETH) and Solana (SOL) also plummeted, with ETH dropping 20% to $3,742 and SOL falling nearly 20% to $178.72 $6 billion wiped out in one hour as Trump’s 130% tariff on China …^[8]. The crash was exacerbated by leveraged positions, with Coinglass data showing $5.39 billion in BTC liquidations and $4.45 billion in ETH liquidations Why crypto briefly but dramatically crashed when Trump renewed …^[3].

Market analysts attributed the volatility to Trump's abrupt policy shift. The president initially framed the tariffs as retaliation for China's rare earth mineral export restrictions but later softened his stance, stating on Truth Social, "it will all be fine" and expressing a desire to "help China, not hurt it." This reversal spurred a relief rally, with Bitcoin rising 4.91% and Ethereum surging 11.68% in a 24-hour period .

The selloff had broad macroeconomic implications. Global equities, oil, and commodities were also impacted, with the S&P 500 and Nasdaq posting their worst declines in months Bitcoin, stocks and oil plunge as Trump imposes additional 100^[6]. However, institutional demand for Bitcoin remained resilient. ETF inflows continued despite the pullback, with CoinShares reporting $2.67 billion in Bitcoin fund inflows for the week, bringing year-to-date totals to $30.2 billion .

Market analysts noted the event highlighted the sensitivity of crypto to geopolitical risks. "The crash was a textbook example of how leverage amplifies volatility in a 24/7 market," said Samir Kerbage, CIO at Hashdex Trump’s new 100% tariffs on China triggered a $19 billion ... - CNN^[5]. Despite the turmoil, structural factors such as ETF adoption and institutional inflows were seen as long-term supports for Bitcoin.

The rebound also reflected shifting investor sentiment. The Crypto Fear & Greed Index moved from "Extreme Fear" to "Fear," indicating cautious optimism . Institutional traders and long-term holders appeared unfazed, with on-chain data showing minimal movement in coins held for over a year .

While the immediate outlook remains uncertain, the episode underscored crypto's integration into global markets. "Digital assets now react in tandem with equities and commodities during macro shocks," noted analysts at Bitunix Research . For now, traders are monitoring Bitcoin's ability to hold key support levels and the broader implications of U.S.-China trade dynamics.