#TrumpTariffs #FedRateCut2025 Market Impact: BTC vs ETH – Why Bitcoin Led the Liquidation Wave

The crypto market went through another heavy correction recently. Prices dropped hard and liquidations surged across exchanges. Bitcoin lost around 12.7 percent, while Ethereum dropped about 14.3 percent. On the surface, it might look like Ethereum took the bigger hit, but Bitcoin actually led the liquidation wave. Out of roughly 19.1 billion dollars in liquidated positions, Bitcoin accounted for the largest share.

That might sound odd at first. If Ethereum fell more, why did Bitcoin trigger most of the liquidations? The answer comes down to market structure, Bitcoin’s dominance, and how traders use it for leverage and collateral.

Bitcoin’s Dominance Still Rules the Market

Bitcoin still controls most of the total crypto market. During this drop, Bitcoin made up more than half of all crypto market value, sitting near the mid-fifties in percentage terms. Ethereum was around the high-teens. That means more capital, more open interest, and more margin exposure are tied to Bitcoin.

Because of that, when Bitcoin’s price moves sharply, the entire market feels it. A lot of traders use Bitcoin as collateral in cross margin accounts. So when Bitcoin falls, it instantly reduces the value of the collateral that backs other leveraged positions. This triggers automatic liquidations not only in Bitcoin trades but also in positions across different pairs connected to it.

Ethereum doesn’t have that same reach. Many ETH positions are either isolated or part of DeFi platforms that have their own risk controls. So even though Ethereum’s percentage drop was bigger, the ripple effect across the wider market was smaller.

How Cross Margin Trading Made It Worse

Cross margin trading is a big part of why Bitcoin ends up leading liquidation waves. In cross margin mode, all of a trader’s balance can support open positions. When Bitcoin, which is often the collateral asset, drops in price, the trader’s total margin value drops too. This makes it much easier to hit liquidation