Bitcoin and Ethereum Rebound After “The Largest Single-Day Wipeout in Crypto History”

During a highly volatile trading session on Friday, Bitcoin plunged from $121,000 to just $109,000 in seven hours, wiping out all gains from the early “Uptober” rally. Ethereum dropped to $3,686, while Solana hovered slightly above $173, according to CoinGecko data.

The panic-driven sell-off sparked a “flash crash of liquidations,” wiping nearly $7 billion from the market in just one hour — with $5.5 billion coming from long positions. By the end of the day, almost $20 billion in positions had been wiped out, including $16.7 billion from longs, CoinGlass data shows.
“This marks the largest single-day wipeout in the history of the crypto market,” said Sean Dawson, Head of Research at on-chain derivatives platform Dervie.

Traditional markets also took a hit, with Nasdaq sliding 3.6%, the S&P 500 dropping 2.7%, and the Dow Jones falling 1.9%.
The sell-off in both stocks and crypto followed President Donald Trump’s surprise announcement that he was canceling a planned meeting with Chinese President Xi Jinping and ordering a massive increase in tariffs on Chinese imports — a move he admitted could be “painful for Americans.”

The decision came after Beijing imposed new restrictions on exports of rare earths and critical minerals, escalating tensions between the world’s two largest economies. However, by the weekend, China appeared to soften its stance, leading analysts to suggest that the market rout may have been fueled by an overblown geopolitical reaction.

“We’re witnessing a textbook relief rally,” said Dean Serroni, CEO of crypto investment firm Merkle Tree Capital.
“Ethereum’s 11% surge is mainly short-covering and mean reversion after the market overreacted to Trump’s tariff bombshell,” he added.

Serroni noted that selling pressure now appears “thin,” while open interest across derivatives markets is resetting after overleveraged traders were wiped out amid extreme volatility.

According to CoinGecko data, Bitcoin is up 5% on the day to $115,100, while Ethereum has jumped 10.5% to $4,138. Other major altcoins are also rebounding strongly: Solana +12%, BNB +16.5%, and Dogecoin +11.4%.

“This was a geopolitical knee-jerk reaction, not a structural breakdown,” Serroni emphasized.