Українська
Русский
English
Crypto Market Loses $1.2 Trillion as Traders Flee
Over the past six weeks, more than $1 trillion has been wiped from the cryptocurrency market as concerns over inflated valuations of tech firms and the trajectory of U.S. interest rates triggered a massive sell-off of speculative assets. As Financial Times reports, citing CoinGecko data, the combined market value of over 18,000 cryptocurrencies has fallen by 25% from its peak on October 6, erasing about $1.2 trillion in capitalization.
Bitcoin fell 28% during this period, dropping to $91,100 and retreating to April lows. Analysts note that losses in margin positions accelerated the decline, and the negative sentiment spilled over into stock markets: indices in Hong Kong, Japan, and South Korea fell between 1.7% and 3.3%, while Europe lost around 1.4%.
The sharp drop marked a reversal after the summer rally, when the sector surged on Donald Trump’s promises to make the U.S. a “bitcoin superpower” and on the appointment of a crypto-friendly SEC chair. “Despite institutional adoption and positive regulatory momentum, the crypto market’s year-to-date gains have been fully erased,” said Brett Knoblauch, a crypto analyst at Cantor Fitzgerald. The sell-off was amplified by doubts over a potential Fed rate cut in December: cooling expectations hit equities as well, sending the S&P 500 down about 3% from its late-October record high.
The worst day came on October 10: Trump’s threat to impose “massive” tariffs on China triggered $20 billion in margin liquidations — the largest single-day wipeout across exchanges tracked by Coinbase. “Crypto investors love leverage. And time after time we see traders overextend themselves, believing that this time will be different,” said Ryan Rasmussen, head of research at Bitwise Asset Management. Within the industry, this day is referred to as “10/10.” “What we’re seeing now is not a crypto market crash. It’s the prolonged aftershock of the October liquidation,” said David Namdar, CEO of CEA Industries. “The scale of the sell-off is different this time because positions were larger, leverage was higher, and the unwind took longer. The fundamentals, however, remain unchanged.”
Beyond bitcoin, more than 40% losses since the start of the year hit six of the 20 largest cryptocurrencies, including Shiba Inu, Sui, and Avalanche — each down roughly 60%. Some analysts believe the October 10 crypto crash may also explain the sharp decline in certain segments of the U.S. stock market in recent weeks. The Goldman Sachs index tracking unprofitable tech companies popular among retail traders has fallen 19% since its peak on October 15.
“We are seeing a significant pullback in retail trading activity in the U.S. equity market roughly since mid-October,” said Viraj Patel, partner and deputy head of research at Vanda, which analyzes retail investor flows. At the same time, flows into defensive exchange-traded funds tracking the broad stock market have increased, he added.
See also: "Binance Reduced the Share of Illegal Transactions by up to 98%"
