Crypto markets retraced sharply late Monday, erasing early-session gains as news of a temporary trade truce between the U.S. and China rattled risk sentiment. The pullback triggered more than $500 million in long liquidations, according to data from Coinglass, signaling a rapid unwinding of leveraged bets across digital assets.
Bitcoin (BTC), which had surged past $104,000 over the weekend, gave up ground to trade below $102,000 by Monday evening. Ethereum (ETH) and other majors followed suit. Coinglass data shows that $530 million in long positions were wiped out in the past 24 hours, including $200 million from BTC futures and $170 million from ETH-linked contracts.
Liquidations occur when traders using borrowed funds are forced out of their positions due to margin calls, typically exacerbating market volatility in the process.
The damage was widespread: Dogecoin (DOGE) and Cardano (ADA) both fell by over 7%, while Solana (SOL), XRP, and BNB each dropped between 5%–6%. The retracement follows last week’s rally, where bullish momentum and short squeezes fueled a surge in altcoins and helped ETH climb 40% in a matter of days.
That uptrend had triggered over $1 billion in short liquidations — the largest wave since 2021 — before sentiment abruptly shifted on Monday.
The reversal came after Washington and Beijing agreed to suspend most tariffs for 90 days, in a move aimed at calming ongoing trade tensions. While the news lifted equity markets — with the S&P 500 and Nasdaq rallying — it appeared to sap enthusiasm from the risk-on crypto narrative that had been gaining traction.
Adding to the cooling effect, futures open interest across major crypto exchanges dropped by more than $1.2 billion, suggesting significant deleveraging as bullish traders were forced to exit positions.
Despite the setback, some analysts remain focused on broader macro trends, especially the upcoming Federal Reserve policy meeting in June.
“Macro remains the main driver,” said Jeff Mei, COO of crypto exchange BTSE, in a message to CoinDesk. “The Fed’s next decision could determine whether Bitcoin breaks through its all-time highs or stalls again. Investors are watching closely to see if the U.S. economy can avoid a hard landing.”
Mei added that a dovish Fed pivot could reignite demand for risk assets, including crypto, as traders seek yield and growth in an uncertain environment.
