The crypto market faced a dramatic downturn as over $300 million in leveraged positions were liquidated following renewed fears of a U.S.–China trade war. Former President Donald Trump’s tariff threats reignited risk-off sentiment, leading to a sharp drop in major cryptocurrencies.
Bitcoin and Altcoins Plunge on Geopolitical Uncertainty
According to data from CoinGlass, the crypto market saw a wave of forced liquidations on Thursday, shortly after Trump proposed new tariffs on Chinese imports if re-elected. This announcement sent a shockwave through global markets.
Bitcoin (BTC) fell by 3% from near record highs, briefly dipping below $106,000, while Ethereum and top altcoins posted losses between 3% to 4%.
“The market wasn’t ready for renewed trade war rhetoric. Risk assets, especially crypto, got hit hard,” said analyst Lark Davis.
Leverage Wipeout: $300M Gone in Hours
CoinGlass reports over $300 million in leveraged positions were liquidated within 12 hours, with the majority being long bets placed during Bitcoin’s recent rally. Many traders overexposed to high leverage were caught off guard, leading to a cascade of stop-outs and forced sales.
“Leverage is a double-edged sword. The late bulls were flushed out instantly,” noted crypto strategist Will Clemente.
This marks one of the largest liquidation events of Q2 2025, emphasizing the risks of over-leveraging in a volatile market environment.
High-Profile Trader James Wynn Hit Hard
Among the most talked-about traders affected is Hyperliquid user “James Wynn,” who recently made headlines for opening a $1.1 billion long position on BTC. According to on-chain analysts, his position is now showing an unrealized loss of over $7.5 million.
“It’s a massive bet, and right now, it’s underwater,” said an analyst from DeFiLlama.
The case of James Wynn underscores the inherent risks of mega-leverage trading, even for high-net-worth individuals.
Market Outlook: Is More Volatility Coming?
With geopolitical uncertainty back in the headlines, analysts warn that further volatility is expected in crypto markets.
“Until the political landscape clears, expect sharp swings in both directions,” said BitMEX CEO Arthur Hayes.
Traders are advised to reduce leverage, monitor macroeconomic developments, and apply tighter risk controls.