Trump Tariffs Fuel Crypto Crash as $19B in Long Positions Liquidate in One Day

Crypto Industry Transformation in 2025

The crypto industry experienced a dramatic transformation in 2025, marked by a record $86 trillion in derivatives volume and a major single-day liquidation event in October. Traders faced massive losses as long positions were wiped out amid a sudden market downturn. President Donald Trump's announcement of 100% tariffs on Chinese imports triggered a "risk-off" sentiment, exacerbating the crash.

Meanwhile, new projects like Mutuum Finance and GeeFi continued to expand their investor bases, signaling a broader shift in the DeFi landscape. According to reports, Mutuum Finance, an Ethereum-based lending and borrowing protocol, reached a milestone with over 18,500 investors. The project is advancing through its roadmap with a structured token distribution and is preparing for its first testnet launch in late 2025. The platform's phased approach has seen the MUTM token price rise significantly, reflecting strong early interest and participation.

In parallel, GeeFi (GEE) celebrated the sale of over 26 million tokens, raising more than $1.6 million in its presale. The project announced a community giveaway to reward its supporters, emphasizing its commitment to fostering active engagement. GeeFi's decentralized ecosystem is designed to offer practical, real-world utility through its wallet and planned financial tools, attracting a growing number of early adopters.

Market Volatility and Regulatory Shifts

The October 2025 crash, often referred to as the "Great Crash," saw over $19 billion in liquidations in a single day. The bulk of the losses came from traders who had positioned themselves on the long side of the market. This event underscored the fragility of leveraged positions in a highly volatile environment. Analysts pointed to broader macroeconomic factors and political developments as key drivers of the downturn.

Amid the turbulence, Trump's pro-crypto executive order, which allowed retirement accounts to invest in digital assets, provided a significant tailwind for Bitcoin. The order pushed Bitcoin to record highs and signaled a shift in U.S. regulatory sentiment. With Gary Gensler's departure from the SEC and the signing of the GENIUS Act, the industry moved toward a more innovation-friendly regulatory framework.

New Infrastructure and Investor Trends

2025 also marked a turning point in how stablecoins were integrated into the global financial system. According to Stablecoin Insider, stablecoins transitioned from speculative assets to a foundational layer for programmable money. The report highlighted how institutional players and governments were leveraging stablecoins for cross-border settlements and payment solutions. This shift was driven by technological advancements and a growing need for scalable, low-cost financial infrastructure.

Mutuum Finance is preparing for a new phase in its token distribution with Phase 7 approaching. The platform has completed multiple security audits and is set to integrate Layer-2 solutions to reduce transaction costs. The project's stablecoin development aims to provide borrowers with more flexible liquidity options, reducing their dependency on single-collateral assets.

What This Means for Investors

The year 2025 demonstrated both the opportunities and risks inherent in the crypto market. For institutional investors, the growing maturity of DeFi protocols and stablecoin infrastructure offers new avenues for capital deployment. However, retail investors continue to face challenges, particularly with the volatility of leveraged positions and the speed at which market sentiment can shift. Trump's policies and broader geopolitical developments will remain key factors to watch in the coming months.

As the industry moves into 2026, the focus is expected to shift toward privacy-centric solutions and further integration with traditional financial systems. The maturation of crypto infrastructure and the regulatory clarity provided by the U.S. government could open the door for even greater institutional adoption. Meanwhile, new projects like Mutuum Finance and GeeFi will continue to test the boundaries of decentralized finance, pushing the industry toward a more inclusive and functional future.