The stunning collapse of the crypto market: liquidations eclipsed even the times of COVID and FTX. What’s next?

This week, the crypto market was hit by a crazy financial tsunami. The massive liquidation caused by the 47th US President Donald Trump’s unexpected statement on tariffs broke the anti-record of the COVID-19 and FTX crash. These are not just numbers: in just one day, the positions of more than 730,000 traders were liquidated. The bitcoin rate dropped below $100 thousand. What will happen next? Let’s take a look at analysts’ predictions.

Billions in losses

Since the fall of 2024, traders and investors have been waiting for a bull run to begin. But as soon as altcoins started to turn green, another painful correction soon followed. At the beginning of 2025, and with the pro-cryptocurrency Trump administration coming to power in the United States, everything seemed to be getting better and the crypto market was reviving again. But the beginning of this month has shown that this is far from the case.

Volatility — is a very mild word to describe the red wave that hit cryptocurrencies. The market has experienced significant fluctuations, including a sharp drop in prices for bitcoin and other digital assets. This situation has caused concern among investors and analysts, who are trying to understand the reasons for this decline and predict further developments.

In just 24 hours, more than 730 thousand traders were liquidated, and the amount of losses reached a whopping $2 billionThis is more than during the COVID-2019 market crash and the FTX collapse in 2022. About said Thea’s Bitcoin analyst Joe Consorti.

The expert also added that ETH lost $35 billion in market capitalization in 35 minutes. Ethereum was the leader in terms of liquidations: $572.99 million. The largest single liquidation was an ETH/BTC order on Binance worth $25.64 million.

Moreover, Bybit CEO Ben Zhou believesthat This figure is underestimated by several times, and traders’ losses amount to about $8-10 billionAs Bybit alone had liquidations of $2.1 billion.

According to him, the data from Coinglass in the screenshot below shows a figure of $333 million, but this is not all liquidations. Bybit has an API limitation on how many feeds are displayed per second. Other exchanges also practice this to limit liquidation data.

For the first time in several months, bitcoin dropped below $100 thousand, down to $93 thousand. However, the rate recovered to $99 thousand after Trump postponed the introduction of customs restrictions for one month (details below). And at the time of writing, it is already over $100 thousand.

The main reasons for the fall in cryptocurrency prices

• US President Donald Trump has announced a 25% increase in tariffs on imports from Mexico and Canadaand 10% for Chinese goods. In response, Canada and Mexico announced countermeasures, and China appealed to the WTO. This caused panic in the financial markets, particularly in the crypto sector. However, the decision on Mexico was later postponed for a month after talks between Trump and Mexican President Claudia Sheinbaum.
• Correlation with traditional financial markets Recent declines in the stock markets, particularly the Nasdaq index, have been caused by the emergence of the Chinese AI DeepSeek caused panic in the tech sector. This, in turn, affected bitcoin and other cryptocurrencies.
• On opinion of the aforementioned Consortium, «there is bitcoin and there is everything else»: «Cryptocurrency» realizes its essence as a casino. All this garbage was backed by 50x and 100x leverage and flushed down the drain in 30 minutes when the price went wrong».
• Disappointment. After Trump’s victory, bitcoin rose to $107,000, but the lack of promised immediate pro-cryptocurrency initiatives disappointed investors, leading to a sell-off in assets. Santiment experts wrotethat «bearish» social media sentiment has peaked (compared to bullish comments) over the past year.

Is it going to get worse? Or was it the last wave?

Despite the current problems and uncertainty in the crypto market, many analysts remain optimistic. They expect the market to recover from the short-term volatility as Trump has initiated the development of crypto regulation, which could create favorable conditions for the industry.

• A senior director at cryptocurrency market maker Wincent believes that «the organic growth we expect over the coming years, thanks in part to a friendlier US administration, will likely outweigh short-term volatility and macroeconomic (tariff) news in the next few weeks».
• Bitfinex analysts predict that the growth in institutional adoption of bitcoin will create strong demand, making the drop in bitcoin’s price in 2025 short-lived. They expect bitcoin to reach $200 thousand by mid-2025.
• Experts of the investment firm VanEck suggestThe bull cycle will continue and reach a medium-term peak in the first quarter of 2025. After that, a correction is expected, but by the end of the year, the market will update its historical highs. They predict that bitcoin will trade at $180 thousand, and the price of Ethereum will exceed $6 thousand.
• Some analysts predictthat the growth of institutional adoption of bitcoin will create strong demand, and bitcoin will reach $200 thousand by mid-2025.

As can be seen from the analysts’ forecasts, they see the current negative events in the crypto market as temporary. Moreover, the author of the books «Rich Dad, Poor Dad» Robert Kiyosaki generally believes that now is the best time to get rich.

The drop in cryptocurrency prices in February 2025 was caused by a combination of macroeconomic factors, regulatory changes, and internal market dynamics. However, given expert forecasts and the growth of institutional adoption, the overall outlook remains positive. However, not everything can be predicted. This is especially true for high-risk assets.