The cryptocurrency market experienced its largest single-day liquidation event on October 10, 2025, as U.S. President Donald Trump's announcement of 100% tariffs on Chinese imports triggered a $19.1 billion wipeout of leveraged positions. The shockwave erased $400 billion in market value, sending
to $101,500 and to $3,373.67, while smaller altcoins like and plunged over 99% before partial recoveries. The collapse mirrored the synchronized sell-off in equities, with the Nasdaq dropping 3.6% and Treasury yields spiking, underscoring the interconnectedness of global risk assets .
Derivatives platforms bore the brunt of the carnage. Hyperliquid reported $10.28 billion in total liquidations, including a $203 million ETH-USDT position-the largest single liquidation of the day. Binance's futures insurance fund drained $188 million, while
futures alone saw $706 million in liquidations. Analysts noted that real-time reporting delays on exchanges like Binance and Bybit likely understate the true scale, as these platforms limit liquidation order disclosures . The event surpassed the combined impact of the 2020 pandemic crash and the FTX implosion, marking a structural reset for leveraged crypto markets .The liquidation cascade exposed years of accumulated leverage. Vincent Liu of Kronos Research called the tariffs "the spark," but emphasized that "leverage was the gasoline." Ethereum's $4.45 billion in liquidations, Solana's $2.02 billion, and XRP's $709 million losses highlighted the fragility of derivatives-heavy altcoins . David Jeong of Tread.fi labeled the event a "black swan," while Arthur Hayes of Bitstamp warned that "we won't see those levels on high-quality alts anytime soon," signaling a prolonged normalization phase .
Macroeconomic uncertainty looms as recovery efforts begin. The Bureau of Labor Statistics expedited September's CPI release amid a government shutdown, a move traders interpreted as a bid to stabilize markets before the next Federal Reserve meeting. Meanwhile, Bitcoin's dominance rose to 59.8%, reflecting a flight to safety as altcoins faced extreme dislocation. Zaheer Ebtikar of Split Capital predicted a "drawn-out bottoming process," with market makers absorbing inventory and arbitraging price gaps between spot and perpetual markets .
The fallout extends beyond crypto. Global trade tensions and supply chain risks now threaten semiconductor and rare-earth sectors, critical to blockchain infrastructure. Analysts at FalconX noted a surge in demand for downside protection, while Bitcoin's correlation with the U.S. dollar index (DXY) intensified, compounding pressure on leveraged longs. The event has reignited debates about crypto's role as a hedge against geopolitical instability, with some institutions viewing the crash as a necessary purge for healthier future rallies .
Source: [1] This is the Full Title of the First News Article (https://coin360.com/news/crypto-market-liquidation-2025-trump-tariffs)
[2] This is the Full Title of the Second News Article (https://www.cnbctv18.com/market/cryptocurrency/trump-tariffs-upend-crypto-market-trigger-record-liquidations-19712071.htm)
[4] Full Title of the Third Source Used (https://www.cryptotimes.io/2025/10/11/massive-19b-liquidation-hits-crypto-markets-after-trump-tariffs/)
[6] Full Title of the Fourth Source Used (https://www.coindesk.com/markets/2025/10/10/usd16b-in-longs-liquidated-as-wall-street-sell-off-extends-btc-eth-broader-crypto-market-meltdown)
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