The cryptocurrency market experienced a dramatic downturn on October 16th, with the total market capitalization falling sharply below the $3...
The cryptocurrency market experienced a dramatic downturn on October 16th, with the total market capitalization falling sharply below the $3.8 trillion mark. The sell-off was primarily driven by Bitcoin (BTC), which dropped to a six-week low of $107,625 around 12:35 p.m. EST. This steep decline pushed Bitcoin's weekly losses into double digits and left it approximately 5% below its price level from the start of the month.
The market volatility was attributed by analysts to several concurrent factors. Some pointed to increased investor caution ahead of a rumored speech by U.S. President Donald Trump, while others linked the downturn to ongoing political uncertainty, specifically the continued impasse in Congress over a bill to end the government shutdown.
Massive Liquidation Event
The most immediate and dramatic financial impact was felt by leveraged traders. The rapid price movement triggered a massive wave of liquidations, wiping out over $714 million in leveraged contracts within a 24-hour period. This single event impacted nearly 220,000 traders across various exchanges.
Data from Coinglass confirmed the severity of the drop, showing that Bitcoin long liquidations alone accounted for more than $102 million in just one hour. The largest single contract liquidated was a BTC position on Hyperliquid, valued at $9.78 million. In total, BTC-related liquidations surpassed $230 million, with Ethereum (ETH) positions following closely behind with $142.2 million in losses.
Altcoin Market Follows Suit
The widespread fear dragged the rest of the altcoin market lower. Major tokens such as Ether (ETH) and BNB registered significant 24-hour losses, falling by 3.2% and 3.5%, respectively. Other high-cap assets, including XRP, Solana (SOL), Dogecoin (DOGE), and Cardano (ADA), also posted steep declines. Tron (TRX) was noted as one of the few high-profile tokens to register gains during the market chaos.
Despite the market-wide slump sparking fears of another wave of mass liquidations on social media, Bitcoin showed signs of recovery shortly after hitting its low. At the time of reporting, BTC had managed to rebound and was climbing just above the $109,000 level, indicating a quick attempt by bulls to defend the new support range.
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