Bitcoin and Ethereum traders remain in wait-and-see mode after last week’s tariff shock wiped out nearly $20 billion in leveraged positions over the weekend, affecting confidence and risk sentiment among most market participants.
Since then, the market mood has shifted from panic to fragile optimism, as both Washington and Beijing toned down their rhetoric, offering a brief pause in what looked like a brewing trade war.
bitcoin rose 1.3% in the last 24 hours to around $113,000, while ether traded near $4,100 after briefly crossing $4,200 overnight. solarium added 2.9% to $201.8, XRP gained 2% and rose 2.3% to $0.20. The broad market capitalization stands at $3.9 trillion, still about 6% below pre-crash levels but up 4.4% from Sunday’s lows, the data shows.
The mood is improving, although unevenly. The Crypto Fear and Greed Index rebounded to 38 from Sunday’s extreme reading of 24, indicating that traders are tiptoeing back. Alex Kuptsikevich of FxPro called Friday’s collapse “an emotional blush” that forced the elimination of weak positions on all exchanges:
“The sell-off began as a reaction to headlines about tariffs, but turned into a wave of forced liquidations. These radical moves often mark a short-term market bottom, although recovery takes time,” he said in an email to CoinDesk.
Friday’s drop, which took bitcoin below its 50-day and 200-day moving averages, has historical echoes. Similar meltdowns in 2020, 2021 and 2024 restored leverage and paved the way for recoveries in the following weeks. But in 2022, confidence took months to recover, a timeline that bargain hunters are now carefully weighing.
Over the weekend, China’s Ministry of Commerce clarified that its restrictions on rare earth exports were not blanket bans, saying applications would still be authorized. Trump echoed that softer tone, posting that “the United States wants to help China, not hurt it.”
Betting markets on Polymarket now value just a 15% chance of 100% rates for November 1, down from 26% at the end of Friday.
The change eased pressure on risk assets. U.S. stocks recovered some of Friday’s loss, and cryptocurrencies followed a familiar pattern in recent months in which digital assets have followed macroeconomic sentiment rather than decoupling from it.
Meanwhile, The Kobeissi Letter described the decline as “a technical, not a structural, event,” driven by cascading margin calls rather than a fundamental shift in positioning.
Analyst Frank Fetter added that crypto markets “remain far from overbought,” leaving room for a potential relief rally if volatility remains subdued.
