After Massive Liquidation, Investors Rush to Hedge Against Another Crash

Crypto markets saw a brutal sell-off earlier this week, following the U.S. announcement of 100% tariffs on Chinese tech imports. Over US$19 billion were liquidated across markets as Bitcoin dropped more than 14% (to ~$104,783), and Ethereum plunged ~12.2% to $3,436. Altcoins suffered even steeper losses: HYPE-54%, DOGE-62%, AVAX-70% before partial recovery. Reuters

Investors are now aggressively buying puts, buying hedging instruments, and waiting for clearer signals before re-entering large positions. The sentiment has shifted to cautious, with many believing that more volatility lies ahead, especially if geopolitical tensions escalate again. Reuters

What It Means for Traders & Xoibit Users

• The crash has removed much of the speculative leverage in the system—though that doesn’t guarantee stability, it reduces tail-risk in the short term.
• Hedging tools, stop-losses, and risk management strategies become more critical. When markets move sharply, those protections often save capital.
• For long-term investors, these dips may offer buying opportunities—but only if you’ve vetted fundamentals.

Outlook

Bitcoin’s ability to recover some losses suggests support remains strong for large cap crypto, but altcoins will likely lag until sentiment improves. Watch for macro policy updates, tariff developments, U.S./China trade news. These are likely to drive the next major moves.