- Bitcoin mining stocks rebound sharply after a flash crash triggered by confusion over China’s export rules and misinterpreted tariff threats from US President Donald Trump.
- Crypto markets face record volatility, with $19 billion in leveraged positions liquidated the largest single-day event in crypto history.
- Binance and Hyperliquid exchanges come under scrutiny, as technical glitches and liquidity gaps deepen market instability during the crash.
Analysts say that confusion over China’s export restrictions briefly unsettled global markets before Bitcoin mining companies powered a swift recovery on Monday.
Shares of major miners such as Bitfarms (BITF) and Cipher Mining (CIFR) jumped by double digits, while Hut 8 Mining (HUT), IREN (IREN), and MARA Holdings (MARA) gained over 4%. Meanwhile, Core Scientific (CORZ) and Riot Blockchain (RIOT) also traded higher at the start of the session.
The rebound followed a sharp sell-off on Friday, when President Donald Trump announced plans to impose 100% tariffs on Chinese imports, sparking fears of a renewed trade war. However, the panic eased after officials confirmed Trump’s statement was based on a misunderstanding of China’s new export rules.
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Over the weekend, Trump clarified his stance, writing on Truth Social: Don’t worry about China, it will all be fine!. He added that Chinese President Xi Jinping had simply “had a bad moment.”
US Treasury Secretary Scott Bessent later reassured investors that the proposed tariffs “don’t have to happen,” while analysts at The Kobeissi Letter confirmed that Trump had misinterpreted China’s October 10th export controls on rare earth minerals used in defense and semiconductor production.
Crypto market volatility reaches historic highs
While mining stocks recovered, the crypto market’s flash crash was far more extreme. In dollar terms, Friday’s event became the largest liquidation in crypto history, erasing roughly $19 billion in leveraged positions even surpassing the scale of the FTX collapse.
Bitcoin (BTC) remained relatively stable compared to altcoins, many of which saw deeper price plunges. The intensity of the sell-off prompted Crypto.com CEO Kris Marszalek to call for a regulatory investigation into how exchanges managed the event. Marszalek questioned whether platforms had slowed executions, mispriced assets, or failed to maintain adequate controls during the crash.
Exchanges face scrutiny over liquidation handling
Approximately half of all liquidations occurred on Hyperliquid, a decentralized perpetual futures platform, which saw over $10.3 billion in open positions erased. Centralized exchanges such as Bybit and Binance also reported substantial losses.
Binance faced additional criticism after reports that some token prices briefly dropped to zero. The exchange attributed the anomaly to a user interface bug affecting certain trading pairs.
The turmoil also impacted Ethena Labs’ synthetic dollar (USDe), which temporarily lost its dollar peg. Ethena founder Guy Young clarified that the depeg was unrelated to the minting or redemption process, explaining that it was caused by a Binance-specific issue tied to an oracle index and liquidity disruption.
The severe price discrepancy was isolated to a single venue, noting that Binance faced deposit and withdrawal delays during the event, preventing market makers from stabilizing prices.
Markets stabilize as confidence returns
Despite the chaos, analysts say the rapid rebound in Bitcoin mining stocks signals renewed investor confidence in the broader digital asset sector. With tariff fears fading and liquidity normalizing, the episode underscored how macro confusion and technical fragility can magnify volatility yet also how swiftly crypto markets can recover once clarity returns.
