The first half of 2025 witnessed “exceptionally pronounced” long liquidations in the crypto market. On Feb. 3, 2025, alone, $1.88 billion in long position liquidations occurred, representing approximately 65% of that day’s total liquidations. This single-day crash liquidated more than 729,000 positions, making it by far the largest one-day liquidation event in the first and second quarters of the year.

Cryptocurrency futures trading and information platform, Coinglass, identified U.S. President Donald Trump’s announcement of large-scale trade tariffs as a primary driver of significant market upheaval. Following weeks of speculation, Trump formally unveiled the “reciprocal trade tariffs” on April 3, 2025, framing them as retaliation against countries he claimed were unfairly restricting U.S. imports.

This announcement sent immediate shockwaves across global financial markets. Key indices, such as the Hang Seng, plunged by nearly 10% within just 24 hours. The cryptocurrency market, which had seen a notable rally leading up to Trump’s inauguration on Jan. 20, 2025, reversed sharply. Bitcoin ( BTC) experienced a significant downturn, dropping to its lowest point in five months, settling at just under $75,000. Some reports indicated an 8.5% single-day decline for BTC immediately following the tariff news.

However, more than a month before the turbulent period ignited by Trump’s tariff announcement, “a confluence of negative macroeconomic developments exacerbated market fragility,” according to Coinglass. These included a hawkish tone from the U.S. Federal Reserve and a profit warning from retail giant Walmart, both occurring on Feb. 25. These events primed markets for a downward trend.

“This combination of factors intensified selling pressure in the already fragile crypto market, leading to another wave of panic-driven liquidations. BTC fell below the psychologically significant $90,000 mark, reaching its lowest point since November of the previous year,” the Coinglass report stated.

Predictably, long positions bore the brunt of the losses. Derivatives platform Bybit alone saw approximately $666 million in positions liquidated, with nearly 90% of those being long positions.

While both BTC and ethereum ( ETH) experienced significant price drops, altcoins were hit even harder. For instance, Solana ( SOL) saw its price halved by more than 50% from its mid-January high to the end of February, resulting in over $150 million in liquidations of associated perpetual contracts.

This trend continued into early March, with BTC briefly falling to $82,000 and most major cryptocurrencies reaching new multi-month lows.

By April 7, however, leveraged long positions “were largely flushed out,” creating favorable conditions for a potential recovery. More than two weeks later, over $600 million in forced liquidations of short positions were registered, marking the crypto market’s largest short liquidation event of the year.

Despite this, long liquidations far outpaced short liquidations in total value during this period, with the largest single-day long liquidation nearly triple the biggest short liquidation day. According to Coinglass, this indicates a prevailing bullish sentiment.

“This dynamic reflects the prevailing bull market cycle, where long positions are more aggressively leveraged and exposed to higher risk. Excessive long optimism and leverage, once critical price levels are breached, can easily trigger cascading liquidations—a ‘death spiral’ of deleveraging,” the report concluded.

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