Original | Odaily Planet Daily ( @OdailyChina )

Author | Asher ( @Asher_0210 )

This morning, BTC briefly plummeted by over 13%, hitting a low of $102,000 and currently trading at $112,000. ETH plummeted by over 17%, while XRP and DOGE plummeted by over 30%. For more market news, see " A Night of Horrifying Crash: Single-Day Liquidation Reaches $19.1 Billion in History, a Wild Flow of Wealth ," "Who Made Billions on the Brink of the Crash? What Opportunities for Instant Wealth Are Near? " and " The Whales Behind the Biggest Liquidation in Crypto History: Air Forces Drank Their Way, Knives Out ."

While the market generally believes that Trump's tariff rhetoric has disrupted crypto market sentiment, the magnitude of this recent altcoin plunge has far exceeded expectations. What exactly triggered this sudden and collective drop in altcoins? The following is a compilation of various analyses and perspectives compiled by Odaily Planet Daily.

Crypto KOL Phyrex: The reason for the plunge may be Trump's tariff policy on China

According to crypto influencer Phyrex, who posted on the X platform, there's no doubt that today's market crash was entirely caused by Trump's tariffs on China. The market had already tacitly accepted that while relations between China and the US weren't exactly friendly, the extended period of tariffs was still creating an ostrich effect. However, Trump's tariff actions on Chinese exports directly tore apart a weak link in the tariff equation.

Since February of last year, every tariff issue involving China has caused a market decline, and this time is no exception. However, I have always believed that tensions between China and the United States will not escalate to a critical point. The last 125% tariff was resolved through negotiations between the two countries, so I don't believe that the relationship between China and the United States will reverse the market trend. However, there is indeed some market panic now, which is unavoidable. I don't know how long this situation will last, and the panic may not end yet.

Arthur Hayes: Large CEX's automatic liquidation of cross-margin position-linked collateral triggered altcoin plunge

BitMEX co-founder Arthur Hayes cited automated liquidations of collateralized cross-margin positions on large centralized exchanges (CEXs) as the cause of the recent price decline for a large number of altcoins. Furthermore, he stated that many high-quality altcoins will not experience this level of price decline again in the near term.

Primitive Ventures founder: The market crash may be caused by a large-scale liquidation of an institution on Binance

Primitive Ventures founder Dovey posted on the X platform, speculating that the recent market crash was caused by a large-scale margin call on Binance by a major institution (possibly a cross-margin trading firm). While further analysis is needed, preliminary data indicates that the price of USDe on Binance plummeted to as low as $0.6, while prices on other exchanges remained relatively strong. Furthermore, there has been a significant discrepancy in trading volume between tokens listed on Binance and those not listed on the platform.

Crypto KOL Big Teacher Bugsbunny: This morning's crypto market crash is a problem with active market makers

Crypto KOL Big Teacher Bugsbunny posted on the X platform that market makers have limited funds, and this limited funds will differentiate between various projects, including Tier 0, Tier 1, Tier 2, Tier 3, and Tier 4, and the liquidity provided is different.

Tier 0 and Tier 1 projects receive the most funding, while other Tier 2 and Tier 3 projects receive a bit of extra support. After Jump's collapse, a large number of projects fell into the hands of active market makers—in other words, unscrupulous market makers. They lacked adequate hedging awareness and likely gave little thought to tail-end hedging, considering only normal market conditions and ignoring extreme market conditions. Therefore, when Trump confirmed his intention to reimpose tariffs, there wasn't enough funding to support all projects. Only large projects could be guaranteed to avoid problems. Funds originally intended to support smaller projects were even diverted to larger Tier 0 and Tier 1 projects. This resulted in market makers lacking sufficient funds to place orders when significant selling pressure emerged. This left them without counterparties, and prices plummeted, as happened with IOTX, plummeting to near zero.

Crypto KOL Hanbalongwang: The market crash may be due to the combined impact of USDe revolving loans, doubling of margin leverage, and Trump's trade war, causing heavy losses for market makers.

Crypto influencer Hanba Longwang posted on the X platform that the recent market crash may be due to the 12% subsidy on USDe. Many market users engaged in USDe revolving loans. Due to the impact of Trump's trade war, USDe was hit by a premium, leading to the liquidation of USDe revolving loans and further declines in USDe. Furthermore, some whales and market makers used USDe as margin in contracts. Due to the USDe depegging discount, their leverage inexplicably doubled, ultimately causing even a 1x long position to be liquidated. This triggered a chain reaction, leading to a rapid decline in the prices of small altcoin contracts and a rapid or even doubling decline in USDe, ultimately causing heavy losses for market makers.

Crypto KOL Dachengzi: WBETH, BNSOL and other contract margins should not be read into spot trading pair prices, and the stampede decline could have been avoided.

According to a post by crypto influencer Dachengzi in the community, he previously mentioned the WBETH risk control issue during a Binance Square options livestream. His main point was that since Binance already allows WBETH and BNSOL to be used as contract margin, there should be no need to read the price index of the spot trading pair and the exchange rate could be fixed at 1:1.

The reason is simple—both assets are essentially internal to the Binance ecosystem, allowing Binance to mint and burn them. If a problem arises, the risk can be mitigated simply through a redemption cycle. Last night's "stampede-like" decline could have been completely avoided.

Crypto KOL Huang Dao: A bug in Binance's market-making mechanism may have caused the entire crypto market to collapse.

Crypto KOL Huang Dao posted on the X platform that the culprit behind today's market crash may be a bug in Binance's market-making mechanism. Almost all altcoins on Binance experienced an unusually sharp drop after 5:18 AM, causing other exchanges to follow suit. Comparing SUI, Binance and Coinbase were both trading at $2 before 5:17 AM. Starting at 5:18 AM, Coinbase began to rebound, while Binance began to plummet, with a maximum drop of 82%, while Coinbase's maximum drop was only 38%, followed by unusually large fluctuations.

What is even more telling is that the PAXG gold contract also began to plummet abnormally at 5:18, while the gold contract was in a closed state during this period and did not fluctuate. This shows that there was an abnormality in the Binance market-making mechanism at 5:18, and all varieties experienced an abnormal plunge.