Bitcoin's $19 billion crash still shapes crypto risk a year later

One year ago, a single tariff announcement erased more than $19 billion in leveraged crypto bets in about a day. It remains the largest derivatives liquidation episode the market has ever recorded.

The trigger came from Washington, not from inside crypto. President Donald Trump announced a 100% tariff on Chinese imports, and markets that had been priced for good news suddenly had to reprice for a trade war.

Crypto derivatives took the hit fastest. Forced liquidations topped $19 billion across exchanges within a 24-hour window.

The damage reached over 1.6 million accounts. Most of the pain fell on traders betting prices would rise: long positions made up roughly $16–17 billion of the total.

Bitcoin had set an all-time high of nearly $126,200 just four days earlier, on October 6. During the crash, it fell somewhere between 14% and 17% intraday, touching lows in the range of $102,000 to $107,000 before clawing some of it back.

Open interest, the total value of outstanding derivatives contracts, dropped by more than 30% during the selloff. Across the broader crypto market, hundreds of billions in market capitalization vanished within hours.

Binance offered $300 million in compensation to users affected by its automated liquidation process during the volatility.