October 10, 2025 marked a historic day for the cryptocurrency market: $19 billion in positions were liquidated in just 24 hours. In comparison, the pandemic crash of 2020 involved only $1.2 billion, and the FTX collapse was $1.6 billion. This was nearly 20 times greater.
The main trigger was Donald Trump's announcement of 100% tariffs on China and new export restrictions on critical software, in response to China's tightening of rare earth metal exports. Analysts note the tariffs triggered a correction, but the market had been overheated for some time.
Bitcoin fell from a record $126,500 to $105,000 (-17%), Ethereum by 18%, and several altcoins lost up to 90%. Overall market capitalization lost $670 billion, and about 1.6 million trading accounts were liquidated worldwide.
The fall was accelerated by automatic liquidations in high-leverage derivatives positions (10x-50x). Major platforms such as Coinbase and Kraken struggled under the load, with many users unable to access their accounts.
Institutional players began withdrawing funds days before the collapse. A major trader opened over $1 billion in shorts ahead of the news, earning up to $200 million on the drop.
Ethereum suffered the most among major coins, with $175 million withdrawn from its ETFs. By contrast, only $4.5 million was withdrawn from Bitcoin ETFs, reflecting greater institutional trust in BTC. In the altcoin market, a "Flash Crash" caused prices to plunge to near zero and then quickly recover due to lack of liquidity.
After the mass liquidations, the market began to recover, with BTC rebounding to $112,000. Analysts see this as a short-term correction, but warn of potential new shocks as US-China trade tensions continue.
Experts advise limiting crypto holdings to 2-5% of total investments, avoiding high leverage, and remaining aware of risks. Tighter regulation is likely after such events.
Despite everything, the infrastructure withstood the stress: blockchain and DeFi protocols operated steadily, and Bitcoin proved resilient. Yet nearly 1.6 million users lost funds overnight.
