The crypto market is down today primarily due to renewed geopolitical tension, massive trader liquidations, and technical instability following U.S. President Donald Trump’s tariff announcement on China.
Main Causes of Today’s Crypto Drop
- U.S.–China Tariff Shock
On Friday, President Trump announced a 100% tariff on Chinese imports starting November 1 , escalating the trade conflict between the two largest economies. This shock spurred a global risk-off reaction , leading investors to pull money from volatile assets like cryptocurrencies.
- Mass Liquidations
More than $19 billion in leveraged crypto trades were liquidated within hours as markets fell sharply. This triggered a cascade of forced selling , amplifying the decline across Bitcoin, Ethereum, and most altcoins.
- Stablecoin Depegging and Market Glitches
The USDe stablecoin lost its dollar peg , falling as low as $0.65, while several wrapped tokens also depegged. Centralized oracles such as Chainlink and Pyth reportedly malfunctioned during the sell-off, causing price feed errors that intensified liquidations.
- Macro and Inflation Concerns
Rising U.S. inflation expectations have weakened hopes for Federal Reserve rate cuts, strengthening the dollar and pressuring crypto valuations further. Investors have thus rotated into safer assets, worsening short-term crypto prices.
- Overheated Market & Profit-Taking
Ahead of the crash, Bitcoin had surged over 90% year-to-date, reaching as high as $126,000 earlier this week. Analysts note that technical overextension and “greedy” sentiment made the market ripe for a correction once negative news hit.
Current Market Snapshot
- Bitcoin (BTC) : around $112,000 , down nearly 7% in 24 hours
- Ethereum (ETH) : down 12–15% , trading near $4,000
- Total Market Cap : roughly $3.7–$3.8 trillion , down over $400 billion in a day
Summary
Today’s crypto downturn is being driven by a combination of Trump’s aggressive tariff escalation , mass liquidations , stablecoin instability , and rising inflation fears. Analysts largely view it as a sharp correction rather than the start of a prolonged bear market, though volatility is expected to remain high through next week.
