$20 Billion in Liquidations Shake the Crypto Market

Friday’s massive sell-off led to over $20 billion in leveraged liquidations across centralized exchanges (CEXs) and hundreds of millions in DeFi protocols. Data from CoinGlass highlights how quickly the crash unfolded, forcing many traders out of their positions.

At the time of writing, Bitcoin trades around $111,825, Ether (ETH) at $3,829, and Solana (SOL) near $182.22. Experts note that the market may remain weak until CME Bitcoin and stock futures reopen on Sunday evening (U.S. time), which will likely dictate BTC’s next direction.

The steep decline in open interest also reflects a lack of trader confidence, as investors hesitate to re-enter a volatile market. The futures market opening will be a critical indicator of how TradFi (traditional finance) is positioning for the upcoming week.

Trump’s Tariff Decision Sparks Panic

Trump’s tweet announcing the 100% import tariff on China hit social media just two hours before U.S. markets closed on Friday, triggering a sharp reaction. Both stock and crypto markets saw a wave of panic selling, with low weekend liquidity amplifying price declines across CeFi platforms.

According to Ray Salmond, Head of Markets at Cointelegraph, Bitcoin remains in a vulnerable range:

“Based on Hyblock Capital’s liquidation heatmaps, there’s a liquidity pocket between $120,000 and $113,000. Long positions in that area are exposed and easily exploited.”

This range represents short-term support levels for Bitcoin, while technical indicators suggest that $110,000 acts as a key psychological zone.

When Could the Market Recover?

For Bitcoin to regain momentum, open interest must stabilize and investor confidence must return. The tone of Sunday’s CME futures opening will offer crucial insights into market sentiment heading into the week.

Possible short-term scenarios include:

• 1) A strong CME opening could trigger a relief rally.

• 2) A weak opening might lead to another test below $110,000.

• 3) A neutral opening may keep BTC trading sideways for days.

Meanwhile, analyst EndGame Macro pointed out that the current sell-off is deeply connected to broader macroeconomic stress and global liquidity tightening.

While traders await signals from traditional markets, crypto volatility is likely to remain elevated in the coming days. Investors are closely watching U.S. economic data and Federal Reserve comments for clues on the next move.

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“Something Positive Will Come Out of It”

Speaking to reporters in Washington, Trump said that despite the high tariffs imposed on China, the process will move in a positive direction. “I think something positive is going to come out of it,” said Trump, adding that he has always had a good relationship with Chinese leader Xi Jinping.

Trump stated that his administration is in discussions about tariffs not only with China but with many countries. According to a previous statement from the White House, tariffs on China will continue to be maintained at a level of 145 percent.

Strong Response from China: “Equality and Mutual Respect Are Essential”

Responding to the US’s aggressive trade policies, the Chinese Embassy in Washington stated that they would only accept negotiations based on equal terms and mutual respect. The Chinese side emphasized that economic pressure and threats are not a solution and stressed that there are no winners in trade wars.

Trump’s Message on Iran: “Let It Be a Happy Country, But Without Nuclear Weapons”

Answering questions from reporters about Iran, Trump said he wants Iran to be a happy and prosperous country, but this must happen without developing nuclear weapons. “I want Iran to be a wonderful, great, happy country. But they can’t have nuclear weapons,” said Trump. His remarks came ahead of high-level talks between the US and Iran scheduled to take place in Oman over the weekend.

“The Dollar Will Always Be the Preferred Currency”

Commenting on the impact of trade tensions on the global currency system, Trump claimed that the US dollar will always remain the primary choice in international trade. “We’re the currency of choice. We’re always going to be… The dollar is tremendous,” said Trump, emphasizing that despite discussions around alternative currencies, the US economy still holds a strong position in the global system.

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Markets Expect a Rate Cut: Powell and Trump Face Off

While concerns about a recession have increased following the new tariffs announced by the Trump administration, investors have begun to think that the US Federal Reserve (Fed) may start cutting interest rates earlier. The activity experienced in bond markets in particular clearly shows that expectations for the growth outlook have weakened.

As bond yields fall, investors are focusing on the possibility of a rate cut rather than growth. The 10-year US bond yield fell below 4%, supporting expectations in this direction.

US President Donald Trump made a clear call to Fed Chair Jerome Powell:

“The Fed is taking it slow, it should lower interest rates! Now is the perfect time to lower interest rates.”

However, Powell is cautious about these calls.

The increased uncertainty due to new tariffs creates dual risks such as rising inflation and slowing growth. According to Powell:

• “The impact of tariffs could be greater than expected and have lasting effects on inflation.”

• “The Fed’s job is to prevent these price increases from turning into permanent inflation.”

• “It’s too early to determine the appropriate direction for monetary policy.”

Powell stated that the Fed will guide its policy with clear data and said, “People expect the Fed to tell the truth, and that’s exactly what we’re going to do.”

However, according to Trump, Powell has always been “a latecomer to a rate cut” and that action should be taken more quickly when the economy is so fragile.

However, expectations for a rate cut are rapidly increasing in the markets. According to CME FedWatch Tool data, markets are pricing in an 85% probability of more than three rate cuts by the end of the year. This means an increase well above last week’s expectations. In particular, a rate cut in June stands out as the strongest possibility with a 70% probability. There is a 30% cut expected for the May meeting.

Powell said in his latest statement, “The current uncertainty is likely to continue. It’s the right time to step back and wait for the water to calm down.” He also added that the impact of Trump’s policies will be clearer in a year.

However, experts believe that the economic slowdown triggered by tariffs could force the Fed to cut interest rates. This would be an unconventional policy choice, especially when inflation is still high.

Trump is pushing for a rate cut, while Powell is determined to tread carefully. However, the market is certain that the Fed will eventually cut interest rates to support economic growth.

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