The crypto market just witnessed its most violent liquidation event in history. Over $19 billion in leveraged positions vanished within 24 hours, wiping out 1.6 million traders across major exchanges. This wasn’t just another crash. It was the largest liquidation event the digital asset market has ever seen, nearly 9× the previous record. To understand the scale, let’s look back at prior black swan events: COVID Crash (March 2020): $1.2B liquidated FTX Collapse (November 2022): $1.6B liquidated At the time, those numbers shocked the industry. But the market today is much larger, about 10× bigger than during COVID, and roughly 4× larger than during FTX’s fall. This time? $19 billion was wiped in a single trading day. That’s $17 billion more than the February 2025 correction. More than 19 times what we saw during the COVID crash or FTX meltdown. As of writing, total global crypto market capitalization has shrunk by more than $420 billion, led by a violent correction in Bitcoin. Bitcoin recorded one of its largest-ever daily candlesticks, a $20,000 swing in 24 hours. That move translated to a $380 billion shift in Bitcoin’s market cap alone, according to CoinMarketCap data. For perspective, that’s more than the market cap of all but 25 public companies in the world. Once again, never in crypto history have we seen anything like this. What Triggered the Crash? The liquidation chain started long before the announcement everyone’s now talking about. At 9:50 AM ET, crypto markets began showing early signs of sell pressure. At 10:57 AM ET, former President Trump posted his now-viral statement threatening new tariffs on China. By 4:30 PM ET, a large whale opened aggressive short positions across major perpetual futures platforms. Twenty minutes later, 4:50 PM ET, Trump officially announced a 100% tariff on Chinese imports. Thirty minutes after that, at 5:20 PM ET, the cascade began. Liquidations spiked to $19.5 billion, mostly concentrated in long positions. The whale who shorted the market reportedly closed for $192 million in profit, according to market trackers. It's official: Crypto just saw its LARGEST liquidation event in history with 1.6 MILLION traders liquidated. Over $19 BILLION worth of leveraged crypto positions were liquidated in 24 hours, 9 TIMES the previous record. Why did this happen? Let us explain. (a thread) pic.twitter.com/dHbkfNjrVs — The Kobeissi Letter (@KobeissiLetter) October 11, 2025 Who Got Hit the Hardest? The imbalance was massive. Data shows $16.7 billion in long positions were wiped out versus just $2.5 billion in shorts, a 6.7:1 ratio. Most of this carnage came from over-leveraged traders chasing the bull rally since April 2025. Almost every major exchange reported over 90% long liquidations, except Bitfinex, which remained relatively balanced. The largest single-day loss came from Hyperliquid, where $10.3 billion in longs were liquidated. It’s also the same exchange where the whale opened those timely shorts. $19B Liquidation in the Crypto Market Due to the US–China Trade War To understand the scale of this liquidation, let’s look at some historical black swan events: – COVID Crash: $1.2B liquidated – FTX Collapse: $1.6B liquidated However, today’s global crypto market cap is also… pic.twitter.com/CWs2HAi5UO — Tom Wan (@tomwanhh) October 11, 2025 Greed, Leverage, and the Shock Effect The setup was clear in hindsight. Crypto markets had turned crowded to the long side following months of relentless upward momentum. The Fear & Greed Index had stayed above 60 for several weeks, signaling high optimism, and overconfidence. Then came the “shock effect.” The tariff post triggered a wave of panic in thin liquidity conditions. Because the announcement came 50 minutes after US markets closed on Friday, spot liquidity was already low. Historically, Friday nights and Sunday nights are known for large crypto moves, low volume means smaller orders move the market more dramatically. When the tariff news hit, billions in long positions collapsed like dominoes. The Domino Effect of Thin Liquidity Thin order books meant that once prices began to drop, liquidation bots kicked in automatically. Each forced sell created further downward pressure, triggering even more liquidations. Exchanges like Binance, OKX, and Bybit all saw liquidation spikes exceeding previous records. On-chain analytics show the majority of liquidations occurred in perpetual futures, not spot, highlighting the danger of excessive leverage during uncertain macro events. The result was a global deleveraging, one of the fastest in digital asset history. What Does This Mean for the Market? Despite the panic, analysts believe this crash was technical, not fundamental. The crypto market had become overheated. Margin levels were unsustainable, and a correction was inevitable. The tariff shock simply served as the match that lit a pile of leverage tinder. While volatility remains high, most indicators point to short-term dislocation, not structural weakness. In fact, on-chain data shows exchange reserves remain low, suggesting that investors are holding, not dumping. If anything, this massive flush may reset the market for the next leg up. What’s Next For The Market Analysts expect heightened volatility over the coming week as traders reposition. A trade deal between the US and China could reverse sentiment quickly. “This week’s rebound in volatility means opportunity for investors,” one trader wrote. “ Crypto remains fundamentally strong, this was leverage, not value destruction.” The macro picture supports that view. Global liquidity remains high, institutional inflows into Bitcoin ETFs are still steady, and risk assets across stocks, commodities, and crypto continue to attract capital. In short, this liquidation looks more like a massive leverage washout than the start of a prolonged downturn. Final Thoughts The $19 billion liquidation marks a record, but it also serves as a reset. A reminder that even in a maturing market, leverage remains the silent killer. Crypto just endured its biggest stress test yet. It survived. And as the dust settles, one thing remains clear, volatility creates opportunity, and the brave will likely find this week’s chaos was the beginning of something new. Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services. Follow us on Twitter @nulltxnews to stay updated with the latest Crypto, NFT, AI, Cybersecurity, Distributed Computing, and Metaverse news !
