Crypto’s catastrophic crash comes as Australian bets pass $1b mark
Just a week ago, Australian investors that piled into cryptocurrency markets were cheering another record for bitcoin. Fast forward to today, and those same highly leveraged traders are reeling after what has been described as the largest liquidation event in crypto history, News.Az reports citing CNBC.
The violent reversal late last week was triggered by US President Donald Trump imposing an additional 100 per cent tariff on China and export controls on software. Bitcoin plunged 12 per cent to below $US110,000 over the weekend, just days after hitting a record high, while other major tokens such as Ether, Solana and XRP whipsawed.
The wild moves were intensified, given Trump’s announcement was made on a US holiday weekend after the market had closed, but before Europe and Asia were awake, meaning there was a lack of liquidity.
“With so much leverage concentrated in shallow markets, even a moderate sell-off snowballed into a full-blown crash,” said Charlie Sherry, head of finance at BTC Markets.
“With a lot of these new traders not maintaining appropriate risk management, the results were catastrophic.”
A record $US19 billion ($28.9 billion) in crypto bets evaporated in just 24 hours as more than 1.6 million traders were liquidated – meaning positions were automatically closed because losses exceeded the margin collateral backing the trade.
However, traders have since swooped in to buy the dip, with BTC reporting strong volumes and heightened activity. Bitcoin was trading back above $US115,000 by Monday afternoon.
Australian investors are heavily exposed to the volatility, having ramped up crypto holdings as Trump ushered in a friendly legislative regime for digital assets and the Federal Reserve kicked off its easing cycle.
The momentum has been turbocharged this year as bitcoin benefits from the so-called “debasement trade” as retail investors flock to it to hedge against ballooning US deficits and higher inflation, which is weakening fiat currencies such as the greenback.
All-in
The booming demand for bitcoin has lifted funds under management for Australian crypto exchange-traded funds above $1 billion for the first time.
“Investors are increasingly viewing bitcoin as a hedge during periods of political and fiscal stress – similar to how gold has historically behaved,” said Betashares head of digital assets Justin Arzadon.
Gold prices hit a record above $US4060 an ounce on Monday, after notching an eighth straight weekly gain on Friday. Other precious metals also rocketed, with silver approaching its own record high.
Australian companies are also adding bitcoin to their balance sheet as businesses adopt the popular tactic of stockpiling the original cryptocurrency made famous by Michael Saylor’s Strategy. Corporate bitcoin allocations on BTC’s exchange jumped 138 per cent between December 2023 and June 2025.
And self-managed super funds are also increasingly embedding digital assets into their retirement strategies, with registrations on BTC’s platform growing 69 per cent year-on-year. Bitcoin, Ethereum and XRP accounted for most allocations.
“SMSFs are operating with the discipline of institutions – executing larger trades, applying structured diversification, and taking a long-term view,” said BTC’s outgoing chief executive Caroline Bowler.
Analysts are tipping that bitcoin will resume its rally soon and keep hitting record levels heading into next year. Citi earlier this month said it expected bitcoin to hit $US132,000 this year and $US181,000 over the next 12 months.
JPMorgan is even more bullish, suggesting that the world’s most traded digital currency could climb to $US165,000, while exchange-traded fund provider Global X expects the token to hit $US200,000 this year.
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