Ethereum News Today: Trump Tariffs Ignite $19B Crypto Meltdown, Ethereum Tumbles Below $4K

Ethereum fell below $4,000 on October 10, 2025, as part of a historic $19 billion liquidation event triggered by U.S. President Donald Trump's announcement of a 100% tariff on Chinese imports. The move intensified global trade tensions and sparked panic selling in crypto markets, with Ethereum experiencing $4.3 billion in liquidated positions-nearly 20% of the total market losses-according to CoinGlass data CoinGlass^[4]. The token dropped 14.2% to $3,742.88, marking its lowest level since late September Coindesk.com^[2].

The liquidation surge followed a broader market collapse, with Bitcoin and Solana also hit hard. Bitcoin declined nearly 10% in five days, while Solana fell almost 20% Coindesk.com^[2]. The total cryptocurrency market capitalization plummeted from $4.3 trillion to $3.74 trillion within 24 hours, erasing $560 billion in value Coindesk.com^[2]. Trading volumes spiked past $490 billion, reflecting heightened volatility and leveraged position closures. Analysts labeled the event the "largest liquidation in crypto history" Timesofindia.indiatimes.com^[7].

The sell-off was driven by leveraged traders being forced out of positions as prices plummeted. Ethereum's Open Interest Weighted Funding Rate hit -0.0345, indicating bearish sentiment dominated the derivatives market CoinGlass^[4]. Institutional investors added to the downward pressure, with Ethereum ETFs recording $176 million in outflows as large holders reduced exposure CoinGlass^[4]. Brian Strugats of Multicoin Capital noted that total liquidations could exceed $30 billion when including smaller exchanges and DeFi platforms Coindesk.com^[2].

Despite the sharp decline, some analysts view the selloff as a temporary correction. BitMine, a major Ethereum holder, continued accumulating 27,256 ETH ($104.24 million) despite a $1.9 million floating loss, signaling confidence in a rebound CoinGlass^[4]. On-chain data also showed $677 million in inflows into long-term Ethereum portfolios in the preceding 24 hours CoinGlass^[4].

The market's reaction underscores the interconnectedness of global trade policies and crypto markets. Trump's tariffs, announced via Truth Social, cited China's export controls on rare earth minerals as justification, escalating tensions to their highest level since 2019 Cnn.com^[6]. The move not only rattled cryptocurrencies but also triggered steep declines in the Nasdaq and S&P 500 Coindesk.com^[2].

Looking ahead, Ethereum's price trajectory may hinge on institutional demand and regulatory developments. Exchange supply has fallen to a three-year low, with spot ETFs like BlackRock's iShares Ethereum ETF attracting $13 billion in net inflows since July 2024 . Whale accumulation has resumed, with large holders adding 411,000 ETH to cold storage or staking pools in the past month . Analysts suggest that sustained ETF inflows and reduced circulating supply could support a rebound, though risks remain from macroeconomic shocks and leveraged liquidations .