1. Bloomberg:
Crypto market traders were hit by record liquidations just days after Bitcoin touched an all-time high, volatility triggered in large part by the latest round of tariffs from US President Donald Trump.
Cryptocurrency prices tumbled on Friday after Trump said he would impose an additional 100% tariff on China and export controls on software. The declines precipitated, and then were made worse by what data tracker Coinglass described as “the largest liquidation event in crypto history.”
While market weakness had already been present coming into Friday, Trump’s post sparked a decline of more than 12% in Bitcoin. The largest token, which had earlier this week reached a record of more than $125,000, was hovering below $113,000 as of Saturday morning in London.
Over the past 24 hours, bets worth more than $19 billion have been wiped out, and more than 1.6 million traders liquidated, according to Coinglass data. More than $7 billion of those positions were sold in less than one hour of trading on Friday.
In its post on X, Coinglass said the total might be much higher given that exchanges don’t necessarily report such orders in real time. Binance Holdings Ltd., the world’s largest crypto exchange, only reports one liquidation order per second, according to the post.
“The focus now turns to counterparty exposure and whether this triggers broader market contagion,” said Brian Strugats, head trader at Multicoin Capital. He added that some estimates place total liquidations above $30 billion. (Source: bloomberg.com)
2. Bloomberg:
In crypto, margin calls don’t work the same way as in traditional markets: when collateral falters, algorithms simply sell. As a result, the plumbing that keeps markets open 24 hours a day also ensures that volatility can cause losses to cascade at a rapid clip. Because Trump made his announcement on a US holiday weekend after the market had closed there, but before Europe and Asia were generally awake, there weren’t as many active buyers and sellers participating in the market.
That said, liquidations were concentrated on smaller coins beyond Bitcoin and Ether, known as altcoins. Leverage tends to be higher and liquidity much lower in those less familiar tokens.
“There’s basically no liquidity for altcoins past five-to-10% of the order book, especially on the bid side,” said Zaheer Ebtikar, founder of crypto fund Split Capital. “So, once an asset really falls out of line, and once it happens to a bunch of assets at the same time, and those market makers go out of sync, the market basically dies.”
That kind of trouble was on full display on the exchange Hyperliquid. Despite being smaller than rival Binance, Hyperliquid experienced the most extinguished trades in dollar value during the 24-hour-period selloff, at $10 billion, according to CoinGlass.
“Hyperliquid had the most amount of long liquidation, and least amount of liquidity to match,” said Ebtikar. (Source: bloomberg.com)
3. Bloomberg:
China said the US should stop threatening it with higher tariffs and urged more negotiations on outstanding issues to agree on a trade deal, responding to President Donald Trump’s latest measures against Beijing.
China’s recent trade countermeasures on US-related issues were necessary, defensive actions, the Ministry of Commerce said in a statement on Sunday. Beijing will take corresponding measures to safeguard its rights if the US persists in its actions, it said.
Trump on Friday announced an additional 100% tariff on China as well as export controls on “any and all critical software” beginning Nov. 1, hours after threatening to cancel an upcoming meeting with Chinese leader Xi Jinping. That came after China added new port fees on US ships, started an antitrust investigation into Qualcomm Inc., and unveiled sweeping new curbs on its exports of rare earths and other critical materials.
China unveiled broad new curbs on its exports of rare earths and other critical materials last week. Overseas exporters of items that use even traces of certain rare earths sourced from China will now need an export license, it announced Thursday, citing national security grounds. Certain equipment and technology for processing rare earths and making magnets will also be subject to controls.
China’s export control is not a ban on exports, and applications that meet the regulations will be approved, the Commerce Ministry said Sunday. Before the measures were announced, China had notified relevant countries and regions through the bilateral export control dialogue mechanism, it added. (Source: bloomberg.com. Italics mine)
4. The biggest challenge China faces right now isn’t the Trump administration and its campaign to decouple the world’s two biggest economies. It comes from within: China is experiencing population decline on a scale and at a speed the world has never seen. This will create ripples that will be felt across China and the world for decades to come. The impact on China’s long-term growth rate could imperil Beijing’s mission to become a global power to rival or replace the United States. And the huge shortage of labor will potentially affect supply chains of products including Barbie dolls, shoes, mobile phones and electric vehicles. “It’s almost impossible to reverse a demographic decline,” said Louise Loo, the head of Asia economics at research firm Oxford Economics. She estimated China’s shrinking workforce could shave 0.5 percent off annual gross domestic product growth over the next decade. (Source: washingtonpost.com)
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