Key Takeaways
Why did the crypto markets crash?
A surprise 100% tariff announcement by President Trump led to more than $19 billion in liquidations; the largest leveraged wipeout in crypto history.
Has Bitcoin Reached the Real Bottom of the Market?
Not yet. Investors are still making profits, which means that complete capitulation and emotional reset have not occurred.
Global crypto markets saw the largest ever wipeout of leverage on October 10 and 11, with over $19 billion in positions liquidated.
The crash followed a surprise tariff announcement from President Donald Trump and a well-timed short film of a major crypto whale.
The sudden crash wiped out weeks of speculative gains in both Bitcoin and Bitcoin [BTC] and altcoins. Now the community remains unsure whether the market has cleared all the excess leverage or whether more downsides are on the way.
The $19 billion domino effect
In less than 24 hours, markets witnessed an unprecedented liquidation cascade, wiping out more than $19 billion in leveraged positions and wiping out more than 1.6 million traders.
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The trigger? A sudden announcement of 100% tariffs by President Trump just minutes after a crypto whale reportedly opened massive short positions.
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According to The Kobeissi Letter, within half an hour of publication, liquidations rose above $19.5 billion, of which $16.7 billion came from over-indebted long positions. Platforms like Hyperliquid [HYPE] alone saw more than $10 billion in long positions washed away.
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The crash showed how weak weekend liquidity and high investor greed left the market vulnerable. One political surprise was enough to cause the greatest destruction in crypto history.
A market purification, but no bottom yet
Although the $19 billion liquidation ended the excessive debt burden did not lead to a complete capitulation.
Reports indicate that the net unrealized gain/loss (NUPL) at the time of writing was around 0.51, meaning most investors continue to make profits despite the sell-off.
Source: CryptoQuant
The crash was quick and mechanical, more panic than surrender.
Source: CryptoQuant
However, exchanges such as Binance played a stabilizing role.
Data showed whales were moving money and inflows soared just before the drop, proving a deliberate risk reset. Binance’s spot trading volume soared to $12.6 billion, absorbing much of the chaos.
The result was a cleaner market structure, but without the emotional bleed that usually signifies a true macro bottom.
The peace before the real reset
Despite the record-breaking liquidation, Bitcoin remained perhaps not yet reached its true bottom yet.
In previous bear markets, such as March 2020 and November 2022, the NUPL measure fell below zero, showing that investors were deep in losses; a clear sign of capitulation.
This time the rate remained positive around 0.5, meaning many traders are still making profits.
Source: CryptoQuant
That optimism often precedes a new decline, because fear has not yet completely gained the upper hand. The leverage may be gone, but sentiment hasn’t been reset.
A stronger recovery can only come if the panic deepens and the NUPL falls further.