TLDR
- US stock futures rebounded over 1% on Monday after Trump softened his stance on China tariffs, saying relations “will all be fine” following Friday’s market rout
- Bitcoin and crypto markets recovered after a $19 billion liquidation event triggered by Trump’s initial 100% tariff announcement on Chinese goods
- Cardano and Dogecoin led the crypto bounce with nearly 10% gains in 24 hours as traders hunted for bargain prices
- Over 6,300 wallets were liquidated on Hyperliquid exchange alone, with some traders losing millions during the flash crash
- Trump suggested the US and China would reach an agreement before the November 1 tariff deadline, easing trade war fears
US stock and cryptocurrency markets staged a strong recovery on Monday following President Trump’s comments suggesting a softer approach to trade tensions with China. Trump posted on Truth Social that relations with China “will all be fine” after his Friday announcement of potential 100% tariffs triggered major market losses.
The initial tariff announcement had wiped roughly $2 trillion from US equity markets. In the crypto sector, the flash crash eliminated nearly $19 billion in positions, marking the largest single-day liquidation on record. Bitcoin dropped sharply before recovering to around $114,665, up 2.7% in 24 hours.
Stock futures showed strong gains before Monday’s opening bell. Dow Jones Industrial Average futures gained 1%, while S&P 500 and Nasdaq 100 contracts jumped 1.5% and 2% respectively. Trump’s reassuring message came after Friday’s announcement sparked concerns about an escalating trade war between the world’s two largest economies.
In his Truth Social post, Trump wrote that “Highly respected President Xi just had a bad moment” and emphasized that “The U.S.A. wants to help China, not hurt it.” When speaking to reporters later, Trump maintained that imposing tariffs on November 1 remained his plan but suggested the two countries would reach an agreement before that deadline.
BREAKING: Trump just posted this about China.
Taco time. pic.twitter.com/b3smphowUD
— Spencer Hakimian (@SpencerHakimian) October 12, 2025
The crypto market recovery was led by alternative cryptocurrencies. Cardano and Dogecoin both gained nearly 10% in 24 hours as traders took advantage of lower prices. Ethereum surged 8.3% to $4,135, while BNB gained 13.9%. XRP rose 7.4% and Solana added 7.2%.
Massive Liquidation Event Shakes Traders
The Friday crash caused extensive damage to leveraged positions across crypto markets. Over 6,300 wallets were liquidated on decentralized exchange Hyperliquid alone. Some traders lost millions as Auto-Deleveraging mechanisms kicked in, closing winning positions to cover systemic losses when insurance funds were depleted.
Justin d’Anethan, head of partnerships at Arctic Digital, described the event as “a massive emotional reset.” He noted that while volatility punished traders in both directions, the longer-term market structure remained intact. ETF inflows continue showing strength and exchange balances remain near cycle lows.
Trade Tensions Show Signs of Cooling
China’s Ministry of Commerce helped ease concerns over the weekend by clarifying that rare-earth export controls would not constitute a blanket ban. This clarification, combined with Trump’s conciliatory message, signaled to markets that the trade war rhetoric might be cooling. Risk assets across both traditional and crypto markets bounced back accordingly.
Jeff Mei, COO at BTSE, stated that if US-China tensions don’t escalate into a full trade war, the market will likely recover and push toward all-time highs. Analysts expect the crypto market’s path forward will depend heavily on interest rates and overall risk appetite.
Trump’s comments on Monday suggested that an “eternity” of time exists between now and the November 1 deadline for implementing the tariffs. This timeframe provides room for negotiations between the two countries. Markets interpreted this as a positive signal that an agreement could be reached.
