Bitcoin experienced a dramatic decline on Saturday, plummeting 8.4% to $104,782, which triggered a significant $19 billion loss across the entire cryptocurrency market. This decline was largely fueled by US President Donald Trump’s recent escalation in the US-China trade war, where he announced 100% tariffs on Chinese technology exports and implemented strict export controls on key software. Trump’s accusations against Beijing of employing aggressive trade tactics, specifically regarding rare earth minerals, sent shockwaves through financial markets globally. The impact was immediately felt, with the S&P 500 Index suffering a decline of over 2% on Friday.
The tumultuous environment in the crypto space led to unprecedented levels of liquidations, with Coinglass reporting that over 1.6 million traders were liquidated within just 24 hours. This included a staggering $7 billion in positions that were sold off in less than an hour. Brian Strugats, the head trader at Multicoin Capital, expressed concerns that total liquidations could exceed $30 billion, raising alarm about potential counterparty exposure and fears of broader market contagion.
Major cryptocurrencies were also severely affected. Ethereum dipped 5.8% to $3,637, while Binance Coin fell by 6.6%, bringing its value down to $1,094.09. XRP was hit particularly hard, plummeting 22.85% to $2.33 and seeing its market cap contract by 16.31% to $140.19 billion. Tether experienced a minor dip of 0.1%, settling at $1.
Despite the chaotic trading environment, Edul Patel, CEO of Mudrex, indicated that the market might still retain a bullish outlook. He noted that Bitcoin temporarily tested $102,000 before making a recovery to $113,000, suggesting that historical patterns in October often lead to relief rallies of up to 21%. Patel pointed to potential liquidity from capital rotating out of gold and the expected approval for US spot altcoin ETFs as factors that could bolster the market. He also considered the recent dip as a buying opportunity for long-term investors in Bitcoin and Ethereum.
The plunge on October 10 marked the largest single-day liquidation in the history of cryptocurrencies, highlighting the vulnerabilities of digital assets amid escalating geopolitical tensions. As the US-China trade war continues to intensify, investors remain cautious and on the lookout for any signs of wider market repercussions.
