Record $19bn crypto crash exposes dark side of leverage boom – DL News
- Crypto markets crashed on Friday after Trump announced new China tariffs.
- That crash was fuelled by a leverage boom that culminated in billions in long positions getting liquidated.
- Signs of market stress included Ethena’s USDe losing its peg to the dollar and Tether trading above peg.
Fresh tariffs on Chinese goods entering the US jolted markets that had seen a massive run-up in leveraged crypto trading, causing Friday’s record-setting flash crash.
Prices of major cryptocurrencies nosedived immediately after US President Donald Trump announced 100% tariffs on Chinese goods Friday.
As crypto markets dipped, leveraged traders were forced to close out their positions, causing a cascade of liquidations that eventually topped $19 billion.
