💥 $500M Wipeout in Two Hours: Bitcoin’s Sudden Slide Exposes How Fragile the Crypto Rally Really Is

A violent jolt rippled through crypto markets on Monday, as Bitcoin’s swift intraday plunge unleashed a cascade of forced liquidations, erasing more than half a billion dollars in leveraged bets and reminding traders just how tightly digital assets remain tethered to global macro shocks.

The world’s largest cryptocurrency dropped roughly 4.6%—falling from $67,600 to $64,435 in under two hours during early Asian trading—according to data from CoinGecko.
By the time volatility settled, over $505 million in positions across the crypto complex had been liquidated, with Bitcoin accounting for $232 million and Ethereum another $126 million, per CoinGlass.

Bitcoin later clawed back some losses to trade near $66,280, still down about 2.7% on the day—but the damage to sentiment was already done.

Unlike past crypto crashes sparked by exchange failures or regulatory crackdowns, analysts say this selloff had no single dramatic trigger.

“This downturn was not driven by unexpected negative news,” said Tim Sun, senior researcher at HashKey Group.
“Instead, policy uncertainty tied to U.S. tariff fluctuations and rising geopolitical risk forced markets to reprice risk assets.”

The tremor began after the Supreme Court of the United States ruled that former President Donald Trump’s “reciprocal” tariffs were unlawful—a decision that initially soothed markets.
But optimism faded quickly when a sweeping 10% global tariff proposal followed, reigniting fears of trade friction and economic drag.

Crypto, once touted as an uncorrelated hedge, instead reacted like a textbook high-risk asset.

Monday’s sharp move triggered a classic derivatives unwind:

The result was less a gradual correction and more a mechanical flush—one that exposed how dependent short-term price action remains on speculative positioning rather than organic inflows.

Confidence in an immediate rebound is already fading.

On prediction platform Myriad, traders now assign just a 37% probability that Bitcoin will surge to $84,000 next—a steep drop from Sunday’s 46.4% reading. The shift signals a rapid cooling of upside expectations as macro uncertainty deepens.

Sun believes sidelined institutional capital is hesitating to step back in.

“In an environment defined by sticky inflation, geopolitical stress, and policy uncertainty, risk appetite has contracted significantly,” he said.

Several external forces are converging to keep markets on edge:

According to rate-watch tools, markets now overwhelmingly expect the Federal Reserve to hold its benchmark rate in the 3.50%–3.75% range at the next Federal Open Market Committee meeting.

At the same time, traditional safe havens are attracting renewed demand. Gold climbed 1.23% on the day to around $5,166 per ounce—another sign that capital is rotating away from speculative trades.

Despite years of “store-of-value” narratives, institutional investors continue to treat crypto as a high-beta extension of the risk spectrum.

“Crypto assets remain anchored at the far end of the risk curve,” Sun noted, meaning they tend to fall first when uncertainty rises and recover only after confidence returns to equities and broader markets.

This dynamic helps explain why Bitcoin often mirrors liquidity conditions rather than operating independently of them.

Analysts caution that any near-term rebounds are likely to be technical bounces rather than the start of a sustained rally. Without fresh capital entering the ecosystem, upside momentum could remain capped.

Sun expects a “protracted bottoming process” unless several macro signals improve simultaneously, including:

“If traditional risk assets remain under pressure, crypto is unlikely to rally independently,” he said. “Stability in stocks is a prerequisite for a crypto recovery.”

Monday’s liquidation wave delivered a stark message: crypto may be technologically distinct, but financially it is still deeply woven into the global macro fabric.

Until that changes, Bitcoin’s next major move may depend less on blockchain innovation—and more on tariffs, interest rates, and geopolitics far beyond the crypto sphere.