The crypto market faced intense volatility as reports emerged 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 U.S. Attorney’s Office may be investigating Tether over alleged third-party abuse of its platform. This report has roiled the market, created fear among investors and led to widespread liquidations.
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Tether pushes back, calling accusations “baseless”
Tether, the issuer of the largest stablecoin USDT with a market capitalization of approximately $120 billion, quickly responded to the allegations. CEO Paolo Ardoino rejected the claims as ‘reckless’ and ‘unequivocally false’. Tether stressed that no official investigation has been confirmed, and emphasized its continued cooperation with law enforcement agencies to prevent misuse of its assets. Ardoino’s statement reassured investors but did little to calm the market’s reaction as the allegations led to significant price shifts.
Bitcoin retreats amid the crypto crash
Bitcoin, which had tested the critical $70,000 level, suffered a notable pullback in the wake of these developments, falling to a low of $66,500 before recovering somewhat. The price swings were reflected in major cryptocurrencies including Solana, Ethereum, Avalanche and Binance’s BNB, all of which suffered losses of more than 4%. The sell-off underscored investor hesitation as multiple risk factors converged.
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Tensions are rising in the Middle East
Tensions in the Middle East, which exacerbated regulatory concerns, further dented investor confidence. Israel’s direct attacks on Iran in response to a recent missile attack have raised concerns about a possible regional escalation. The situation increased risk aversion in global markets, particularly affecting high-risk assets such as cryptocurrencies.
According to Coin glass dataThese factors led to $380 million in daily liquidations, with long traders accounting for $310 million of the losses. Altcoins were the hardest hit, with more than $90 million in liquidations, followed by Bitcoin with $65 million and Ethereum with $58 million. This sudden wave of liquidations has created a FOMO in the market and traders are in fear.
Of American elections In just ten days, the swings will be considered normal events and could pave the way for a broader post-election rally. What do you think? Tell us.
