Investors experienced a turbulent day on the cryptocurrency markets as significant price declines were triggered by political developments. Following a morning announcement by U.S. President Donald Trump, who threatened to impose “massive” new trade tariffs on China, both cryptocurrencies and stocks began to tumble, reflecting heightened anxiety among investors. The situation worsened later in the day when Trump amplified his rhetoric in a subsequent post on Truth Social, which resulted in a more aggressive sell-off.
Bitcoin, which had been maintaining a value of over $121,000 earlier in the day, fell sharply below $106,000 by the afternoon, as reported by CoinGecko. More severe losses were observed among altcoins. Ethereum saw a significant drop from $4,300 to a multi-month low of under $3,600. Other cryptocurrencies like Dogecoin and Cardano experienced staggering declines, with temporary drops exceeding 40% before regaining some value. Notably, within the top 100 cryptocurrencies by market capitalization, coins such as Story (IP) and Worldcoin (WORLD) plunged more than 50% within just one hour.
As the market downturn unfolded, an unprecedented wave of liquidations occurred, amounting to over $19 billion within 24 hours, according to data from CoinGlass. This figure marks a historic high for the cryptocurrency market, with around $17 billion attributed to long positions—bets that expected asset prices to rise. The magnitude of this liquidation event dwarfed past incidents, with industry experts recalling smaller events like the $1.2 billion in liquidations during the initial Covid-19 lockdowns in 2020 and the $1.6 billion that followed the FTX collapse in 2022.
CoinGlass remarked on various social media platforms that the event represented the largest liquidation in cryptocurrency history, with 1,618,240 traders affected. They noted that the actual liquidation total could be higher, as platforms like Binance report only one liquidation order per second.
In the wake of Friday’s dramatic sell-off, some cryptocurrencies have recovered modestly but remain significantly lower than their recent highs. Bitcoin currently trades just above $112,000, reflecting an almost 8% drop from before the sell-off. Ethereum has decreased by 12%, now priced at approximately $3,816, while XRP fell by 13% to $2.45. Among the top assets, Dogecoin faced the steepest decline with a fall of 24% to $0.19, while Solana also saw an 18% decrease to $183.
Looking ahead, analysts anticipate continued volatility over the weekend for Bitcoin, with predictions indicating a 56% likelihood that the leading cryptocurrency will experience more declines than recoveries before the week concludes.
