Bitcoin News Today: Crypto's $9.6B Liquidation Cascade: Trump Tariffs Expose Market's Geopolitical Vulnerability

The cryptocurrency market experienced a dramatic flash crash on October 10, 2025, following U.S. President Donald Trump's announcement of a 100% tariff on Chinese imports, sparking widespread volatility and triggering massive liquidations. Bitcoin (BTC) plummeted nearly 10% to $107,000 within hours, erasing $12,000 from its price in minutes. Ethereum (ETH), XRP, BNB, and Solana (SOL) saw even steeper declines, with combined market losses exceeding $500 billion Forbes^[1]. The total crypto market capitalization dropped by $200 billion, reaching $4 trillion as traders scrambled to offload leveraged positions TheStreet^[4].

The selloff was driven by a cascade of forced liquidations, with over $9.6 billion in positions wiped out in 24 hours-the largest single-day liquidation event in crypto history Forbes^[1]. Bitcoin and Ethereum accounted for $3.3 billion of these losses, while altcoins like Solana and XRP faced disproportionately larger declines Forbes^[1]. Sean Dawson, head of research at Derive.xyz, noted that $7 billion in liquidations occurred within one hour, with $5.5 billion stemming from long positions Forbes^[1]. Analysts from 10x Research added that altcoins collapsed multiple times more than Bitcoin, with funding rates turning "deeply negative," signaling extreme market stress Forbes^[1].

The crash followed Trump's escalation of trade tensions with China, including a threat to impose export controls on "critical software" and a cancellation of a planned meeting with Chinese President Xi Jinping. The timing caught markets off guard, intensifying liquidation pressure on leveraged positions. Binance and Coinbase reported system strain, with Binance emphasizing user fund safety amid the turmoil Yahoo Finance^[5].

Macroeconomic factors exacerbated the sell-off. The U.S. Dollar Index (DXY) fell 0.63% post-announcement, while 10-year Treasury yields dipped below 4.07% as investors sought safe-haven assets like gold, which surged past $4,000 per ounce . The broader market impact extended beyond crypto, with the S&P 500 showing technical weaknesses and oil prices dropping below $60 Forbes^[1].

Traders and analysts remain divided on the short-term outlook. While some view the crash as a "leverage flush" rather than a downtrend, others warn of further declines. Bitcoin's price near $110,000 is seen as a critical support level, with predictions ranging from a potential dip to $100,000 to a rebound if institutional inflows stabilize . The Trump-linked token WLFI, tied to the president's family, also crashed 28.9% in 24 hours, losing 61% of its value since mid-September Yahoo Finance^[2].

The incident underscores crypto's heightened sensitivity to geopolitical and macroeconomic risks. As Trump's policies remain uncertain, market participants are bracing for further volatility. "The setup is both chaotic-and full of opportunity," noted 10x Research analysts, highlighting the dual nature of the crisis Forbes^[1].