Trump's tariff threat sparks over $7 billion in crypto liquidations
Cryptocurrency prices plunged on October 10, 2025, after US President Donald Trump announced plans for an additional 100% tariff on Chinese goods and export controls on critical software. Bitcoin fell more than 10% to below $110,000, while other major tokens like Ethereum and Solana dropped 15-30%. The sell-off led to over $7 billion in leveraged position liquidations within hours, according to Coinglass data.
The sharp decline in cryptocurrency markets began late Friday morning in US time, triggered by escalating trade tensions between the United States and China. President Trump, responding to China's imposition of export controls on rare earth metals, posted on his Truth Social platform about preparing a 'massive increase' in tariffs on Chinese imports. He later specified that starting November 1, 2025, the US would impose an additional 100% tariff on all Chinese goods on top of existing duties, along with export controls on 'any and all critical software.'
Bitcoin, which had reached an all-time high above $125,000 earlier in the week, tumbled more than 12% initially, trading around $113,000 by Friday evening in New York. Prices briefly fell below $110,000, marking a 10-12% drop over 24 hours. Ethereum plunged 16-18% to below $3,700 from highs near $4,386, while Solana and XRP crashed 20-30% to $174 and $1.87, respectively. The broader crypto market erased nearly $280 billion in capitalization.
The volatility wiped out over $7 billion in leveraged positions in less than an hour, affecting more than 1 million traders, per Coinglass. Some sources reported figures up to $9.45 billion in total liquidations. Crypto-related stocks also suffered: Circle (CRCL) fell over 6%, Robinhood (HOOD) and Coinbase (COIN) declined 5%, and MicroStrategy (MSTR) slipped 3%.
Traders reacted with alarm. 'Covid level nukes,' said prominent trader Bob Loukas on X, calling it a 'nasty' shakeout. Ram Ahluwalia of Lumida Wealth described it as a 'brutal day' due to the Trump news and overbought conditions. Zaheer Ebtikar of Split Capital noted the 'altcoin complex got absolutely eviscerated,' reaching levels unseen in over a year.
The event rippled to traditional markets, with the S&P 500 down 1.6-2.7%, Nasdaq 1.3%, and WTI crude oil nearly 4% below $60. Gold rallied over 1% above $4,000 per ounce as a safe-haven asset. This marks one of the steepest single-day drops in crypto for 2025, echoing prior tariff-induced sell-offs in April and August.