Crypto Liquidation Arises Amid Tether Audit Fears and Geopolitical Concerns
The crypto market experienced high volatility following reports of a possible investigation into Tether, followed by heightened geopolitical tensions in the Middle East. On October 25, the Wall Street Journal reported that the US Attorney's Office may be investigating Tether for alleged third-party abuse of the platform. The report sent shockwaves through the market, sparking investor panic and massive liquidity.
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Teter pushed back, calling the allegations “unsubstantiated.”
The issuer of USDT, the largest stablecoin with a market cap of nearly $120 billion, was quick to respond to the allegations. CEO Paolo Arduino dismissed the claims as “reckless” and “unequivocally false”. Teter emphasized that no official investigation has been confirmed, showing his cooperation with law enforcement to prevent misuse of the assets. Arduino's announcement reassured investors, but did little to calm the market's reaction as the lawsuit led to significant price swings.
Bitcoin Pulls Back Amid Crypto Crash
Bitcoin, which had been testing the crucial $70,000 level, suffered a significant retracement on these developments before recovering slightly to the lows of $66,500. The price swings were mirrored by major cryptocurrencies, including Solana, Ethereum, Avalanche and Binance's BNB, all of which lost more than 4 percent. The selloff underscored investor hesitancy as several risk factors converged.
Also read: Bitcoin, ETH and XRP Price Prediction: Bull Run to Begin Post-Elections? ,
Mountains of Middle Eastern tensions
Exacerbating regulatory fears, Middle East tensions weighed heavily on investor confidence. Israel's direct attack on Iran in response to recent missile attacks has raised concerns about regional escalation. The situation has raised risk aversion in global markets, particularly affecting high-risk assets such as cryptocurrencies.
According to Coinglass data, these factors lead to 380 million dollars in liquidations every day, while long traders hold 310 million dollars in losses. Altcoins were the worst hit with over $90 million in liquidity, followed by Bitcoin at $65 million and Ethereum at $58 million. This sudden wave of liquidity has created FOMO in the market and traders are panicking.
With the US election just 10 days away, the upheavals are seen as a regular occurrence and could pave the way for a wider vote of support. what do you think? Tell us.
