The global cryptocurrency market experienced a severe market shock on Friday after former U.S. President Donald Trump announced a sharp escalation in trade tensions with China, unveiling a 100% tariff hike on Chinese imports alongside new export controls on critical software.
According to data from Coinglass, the sudden policy move triggered the largest crypto liquidation in history, wiping out over $19 billion in leveraged positions within just 24 hours and impacting approximately 1.6 million traders worldwide.
Bitcoin led the cascade of losses, plunging more than 12% from its recent all-time high above $125,000 to below $113,000 during New York trading.
Long positions bore the brunt of the sell-off, with Bitcoin accounting for $5.34 billion of the total liquidations, followed by Ethereum at $4.39 billion and Solana at $2 billion. Other altcoins collectively added $1.5 billion to the tally.
In a post on X, Coinglass noted that the actual total could be significantly higher since not all exchanges report liquidation data in real time.
It pointed out that Binance, the world’s largest crypto exchange, registers only one liquidation order per second, potentially understating the true scale of market losses.
The abrupt tariff announcement intensified fears of a renewed U.S.-China trade war, rippling through both digital and traditional markets. Stocks and oil prices also fell as traders reacted to the potential for broader economic disruption.
Brian Strugats, head trader at Multicoin Capital, warned of “counterparty risks and potential contagion effects” that could exacerbate financial instability. Analysts have speculated that total liquidations might ultimately surpass $30 billion as investors reassess exposure amid deepening geopolitical uncertainty.
Trump’s tariff decision, set to take effect on November 1, was framed as a response to China’s ‘aggressive trade position’ and recent restrictions on rare-earth mineral exports vital for technology manufacturing. The move also included new U.S. export controls targeting software, further escalating the economic confrontation.
This historic liquidation event highlights the extreme sensitivity of cryptocurrency markets to global political developments and regulatory shifts.
Investors are now closely monitoring the evolving trade dynamics between Washington and Beijing, as escalating tensions threaten to undermine confidence across both digital and conventional asset classes.
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