Binance CEO apologizes for inconveniences caused by network’s technical issues during the crash.
Crypto news has been revolving around the weekend crash as a consequence of Trump’s vow to slap China with tariffs.
The announcement dampened market sentiment, and highlighted another potentially bearish phase ahead for risk-on assets including cryptocurrencies.
The tariffs talk is back on crypto news headlines and this time it is because of China’s response to President Trump’s threat to reignite the tariff war.
It turns out that the whole row was about China’s plans to implement export controls on rare minerals.
Trump’s administration interpreted the move as China’s intention to avoid selling rare earths to the U.S, thus the decision to retaliate.
However, China’s response revealed that the export controls were misunderstood. China’s response suggests that the market crash during the weekend was based on a misunderstanding.
This could turn out to be positive crypto news, consequently setting the market up for a recovery.
China’s response suggests that the misunderstanding may shift the liquidity tides and potentially emerge as positive crypto news this week.
The market has been on high alert with more downside expected on account of Trump’s plans to implement a 100% tariff on China starting from 1 November.
The crypto market remained subdued the last time there was a tariff war escalation. However, China’s statement suggests the possibility that a full blown trade war might not actually take place.
It also highlighted the country’s stance which suggests that China might be trying to de-escalate the situation.
The big question was whether China’s statement will encourage Trump to reverse his stance on the tariff war. If so, this could potentially accelerate recovery mode for the market.
The overall crypto market’s performance in the last 24 hours favored the bulls. The market bounced back from as low as $3.6 trillion to $3.8 trillion, confirming that market sentiment achieved some recovery.
This recovery might be linked to China’s statement and could potentially fuel more recovery ahead.
Additional data about the recent crypto market crash has emerged revealing that it was more severe than initial reports suggested.
Analysts claim that Trump’s tariff 2.0 threat may have triggered as much as $400 billion worth of liquidations.
However, some market observers have disputed that figure stating that a $400 billion liquidation event would have caused a much larger crash.
Meanwhile, Binance faced a lot of backlash for frozen operations as the market was crashing. Some users claimed that they were unable to exit their positions during the crash.
This meant they were unable to protect their capital from being eroded by the massive liquidation event and its subsequent bearish impact.
Preliminary reports attributed the technical issues to API throttling. In other words, the sudden spike in activity reportedly overwhelmed the network.
This technical glitch affected roughly 5% of the liquidations observed during the crash according to Coinglass.
Binance CEO Richard Teng expressed an apology while promising to ensure safeguards against such outcomes in the future.
In the meantime, improving market sentiment combined with the still discounted price may set the market up for an interesting week ahead.
Especially if more positive crypto news emerges, contributing to the recovering market sentiment. Analysts will particularly be keeping an eye on spot ETFs to establish institutional bias.
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