Bitcoin Flash Crash Erases $7B in Crypto Value as Trump Intensifies China Tariffs

Bitcoin Plunges Below $110K as $7B in Crypto Positions Liquidated After Trump’s Tariff Threat

Cryptocurrency markets suffered a severe rout on Friday after U.S. President Donald Trump escalated trade tensions with China, announcing plans for a 100% tariff on Chinese goods beginning November 1. The move sparked panic across digital assets, triggering more than $7 billion in liquidations and one of the most violent sell-offs of 2025, according to CoinGlass.

Bitcoin (BTC), already under pressure earlier in the session, slumped 12% to below $110,000 after trading near $117,000. The decline intensified moments after Trump’s Truth Social post confirmed the new tariff measures and additional export controls on “critical software,” sending BTC down $3,000 within minutes.

Altcoins saw even steeper losses. Ether (ETH) plunged 16% to below $3,700, while Solana (SOL), XRP, and Dogecoin (DOGE) fell between 20% and 30%. Smaller tokens such as Cardano (ADA), Chainlink (LINK), and Aave (AAVE) collapsed as much as 40%, marking their biggest single-day losses in over a year.

“This was a Covid-level nuke,” said trader Bob Loukas, calling the event “the mother of all shakeouts.”

“Brutal day,” wrote Ram Ahluwalia, CEO of Lumida Wealth, who attributed the sharp reversal to a combination of “overbought conditions and Trump’s tariff escalation.”

Prominent trader Pentoshi described the drop as a “top-three all-time flush,” noting that altcoins fell as hard as they did during the March 2020 pandemic crash.

“The altcoin complex got absolutely eviscerated,” added Zaheer Ebtikar, CIO of Split Capital, calling the collapse a “full leverage reset” that brought prices back to multi-year lows.

Friday’s flash crash underscores the crypto market’s heightened sensitivity to geopolitical shocks and macro headlines. Despite strong institutional flows earlier in the month, sentiment has flipped sharply risk-off as traders reassess exposure ahead of a potentially volatile November.