Crypto Market Bounces Back After Major Sell-Offs

This week started with turmoil, but the crypto market has finally started to stabilize, thanks to supportive macroeconomic trends.

Recent data reveals that liquidations totaled $384.4 million over the past 24 hours, a noticeable decrease from previous days. Simultaneously, the global crypto market cap saw a rise of 1.1% during this period.

Market Recovery Post-Liquidation

The sharp downturn in the crypto market was largely attributable to fears regarding a potential global recession and ongoing trade disputes, triggering Bitcoin (BTC) and Ethereum (ETH) to hit new lows, both for the month and the year.

This dramatic fall led to widespread liquidations, with reports indicating that almost $1 billion left the market in a single day. However, the recent figures offer a slightly more optimistic view.

According to data from Coinglass, the $384.4 million in liquidations within the last day consisted of $138.2 million from long positions and $246.2 million from short positions. Specifically, Bitcoin accounted for about $186.7 million of the total liquidations, with $146 million stemming from short positions, while Ethereum recorded liquidations totalling $73.6 million.

Notably, Bitcoin managed to regain traction, trading above $80,000 at $82,299, reflecting a 3.6% increase within the day.

Diplomatic Developments and Political Reassurances

The recovery may be attributed in part to recent diplomatic progress. Reports from Bloomberg mentioned that Ukraine has agreed to a temporary 30-day ceasefire based on a proposal from the U.S., which has helped to alleviate some of the geopolitical strains that previously weighed heavily on market sentiment.

In addition, Ontario has made strides toward easing trade tensions by suspending tariffs on electricity exports to states including Michigan, New York, and Minnesota.

Political voices in the U.S. have also provided reassurances. House Speaker Mike Johnson suggested that President Trump’s economic strategies, which may have initially introduced instability, could ultimately lead to market stabilization. “Give the president a chance to have these policies play out,” he stated.

“We are in a period of economic transition,” stated White House Press Secretary Karoline Leavitt, emphasizing that the market’s recent dip should not be viewed as a lasting trend.

She noted that market indicators like stock prices and trading volumes are reflective of specific time points and are subject to change. These combined factors—political reassurances, easing trade tensions, and diminishing geopolitical risks—have fostered a recovery in the crypto market.