The crypto market experienced the largest wave of liquidations in its history. Following U.S. President Donald Trump’s announcement of a 100% tariff on Chinese goods and China’s retaliatory export restrictions effective November 1, 2025, volatility surged sharply. Bitcoin on Binance dropped to $101,516, while Ethereum fell to $3,000. Within 24 hours, total liquidations reached approximately $19.134 billion, with long positions accounting for $16.679 billion.
What Happened on Spot and Derivatives Markets
According to Binance Futures, the total balance of the insurance fund for USDT-margined BTC, ETH, and BNB contracts fell from $1.23 billion to $1.04 billion, with $188 million used for risk management at the peak of volatility. On the spot market, some altcoins dropped as much as 90%.
Data from Coinglass shows that the largest volume of liquidations occurred on Hyperliquid — $10.28 billion in total, of which $9.3 billion were long positions. For the first time in two years, the automatic deleveraging (ADL) mechanism was triggered for cross-margin contracts.
Exchange founder Jeff Yan reported 100% uptime and no outstanding debt. Some ADL trades were unsuccessful, but the mechanism as a whole functioned correctly. The HLP Vault profit indicator rose by about $40 million, from $80 million to over $120 million in a single day.
The Solana core development team, Anza, noted that the network passed its largest-ever stress test, reaching a peak throughput of 100,000 TPS while maintaining full stability.
Market Participants Respond
BitMEX co-founder Arthur Hayes linked the altcoin crash to automatic collateral liquidations on major centralized exchanges, which triggered a chain reaction of sell-offs. He added that, in his view, many high-quality altcoins are unlikely to revisit the lows recorded during the crash.
Binance co-founder Yi He announced that the company is preparing its largest-ever compensation program and will review user claims individually. Binance also confirmed payouts to users affected by the depegging of USDE, BnSOL, and wBETH.
At the same time, Binance will strengthen its risk management framework. The exchange plans to include redemption prices in the USDE, WBETH, and BNSOL indexes, introduce a minimum price floor for USDE, and increase the frequency of risk parameter reviews.
The company confirmed that total compensation payments already exceed $283 million and refuted three widespread claims:
– about a “major downtime” (the futures, spot, and API cores remained fully operational),
– about depegging being the primary cause of the crash (price declines began before depegging occurred),
– and about liquidations caused by extreme price spikes (known as “price wicks”) — the exchange uses a mark price system that excludes abnormal ticks.
Current Market Outlook
At the time of the update, prices were recovering from their lows following Trump’s latest statement. According to CoinMarketCap, Bitcoin has rebounded above $115,341, while Ether is trading around $4,200. Derivatives volumes remain elevated as traders hedge risk and shift positions to instruments with enhanced collateral control.
