Crypto bounces back from record wipeout on easing trade fears
Bitcoin has reached a record of US$126,251 as recently as Oct 6
[SINGAPORE] Most major cryptocurrencies rebounded from steep losses suffered over a brutal weekend sell-off, as US President Donald Trump sought to quell concerns over its trading relationship with China.
Bitcoin was trading above US$115,000 on Monday (Oct 13) morning in Singapore, after sliding below US$105,000 on Friday in the US. Smaller tokens also regained some ground, with Ether back to about US$4,200 after falling to less than US$3,500.
The gains coincided with Sunday statements from Trump and Vice-President JD Vance signalling openness to a deal with China that eased trade tensions. A record US$19 billion in crypto bets were erased and crypto prices tumbled after severe new China tariffs announced by Trump on Friday. Leverage, automatically triggered sales and low liquidity at odd hours for global trading compounded losses for traders.
“The rebound is driven by a conciliatory message from Trump,” said Richard Galvin, co-founder of hedge fund DACM. Most so-called altcoins, shorthand for smaller tokens, are still trading well below where they were on Oct 9, Galvin added. “Looking forward, headline risk, like throughout 2025, remains high and the market is exposed to any further trade escalation pronouncements or any other left-tail risks.”
The sell-off’s impact was wide-ranging. Ethena USDe, the third-largest stablecoin, briefly lost its US dollar peg. Binance, the biggest digital-assets exchange, experienced technical glitches. More than 1.6 million traders were liquidated, according to data tracker Coinglass.
Executives head into the week wondering who bore the brunt of the losses. So far, they have not uncovered any evidence of a blowup, a nagging fear in crypto markets after previous collapses, such as that of Sam Bankman-Fried’s FTX, sparked daisy-chains of failures.
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Funding rates, the interest paid by bullish traders to take on leverage for futures bets, have plunged to their lowest levels since around the time of FTX’s implosion in 2022, among “the most severe leverage resets in crypto history”, Coinglass said in a research note. That reset in options markets will “place a surer footing under pricing over the medium term”, Galvin said.
Bitcoin reached a record of US$126,251 as recently as Oct 6, and remains up 23 per cent for the year, fuelled in large part by Trump’s pro-crypto policies in the US. BLOOMBERG
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