President Donald Trump’s recent threat to impose a steep 100% tariff on imports from China has sent shockwaves through the cryptocurrency market, resulting in a significant sell-off late Friday. This turmoil exposed the vulnerabilities associated with leveraged trading in the digital currency space.
Bitcoin, ether, and solana were among the cryptocurrencies most affected, with total liquidations reaching an astonishing $18.28 billion as per data analysis platform CoinGlass at 3:47 p.m. ET. This large-scale sell-off coincided with a broader market downturn, as both the Nasdaq and S&P 500 registered their most substantial declines in six months.
In just 24 hours, approximately $5 billion worth of bitcoin was liquidated, along with $4 billion in ether and around $2 billion in solana. CoinGlass referred to this event as the “largest liquidation event in crypto history,” highlighting the volatility intrinsic to the market.
As of 3:45 p.m. ET, bitcoin had experienced a nearly 10% decline over the past five days, trading at $111,616.20. This was a notable recovery from a drop to $103,000 earlier on Friday. Ether also saw a dramatic fall, priced at $4,365.63 before plummeting to $3,742.88—marking a 14.2% decrease. Solana experienced a nearly 20% drop, starting at $223.10 but sinking to $178.72.
The cryptocurrency market had previously enjoyed significant growth since Trump assumed office earlier in the year. This upswing was attributed to a shift in the President’s stance on digital currencies—from initially dismissing bitcoin as “based on thin air” to engaging with crypto enthusiasts at conventions, launching his own meme coin, and suggesting a strategic reserve for cryptocurrencies. An executive order issued by Trump, which permits digital assets to be included in 401(k) plans, had recently propelled bitcoin to a record high of $124,000 just last week.
Tensions between Washington and Beijing have heightened amid ongoing trade negotiations, particularly after China intensified export restrictions on vital rare earth minerals. The re-ignited trade friction signals potential instability in both global markets and the cryptocurrency realm, leaving investors on edge about future movements.
