A sharp pullback in crypto markets late Monday triggered over $500 million in long liquidations, erasing earlier gains as bitcoin (BTC) slipped from weekend highs and traders reacted to de-escalating U.S.-China trade tensions.

Coinglass data shows more than $530 million worth of long positions were liquidated in the past 24 hours — with nearly $200 million coming from bitcoin-tracked futures and $170 million from ether (ETH) products.

Liquidations occur when an exchange forcibly closes a trader’s leveraged position due to insufficient margin. It happens when a trader cannot meet the margin requirements for a leveraged position, that is, when they don’t have sufficient funds to keep the trade open.

Majors bore the brunt of the drop, with dogecoin (DOGE) and cardano (ADA) each falling as much as 7%, and solana (SOL), xrp (XRP) and BNB Chain’s BNB losing between 5%–6%.

The liquidations marked a reversal from last week’s euphoric rally, which had seen ETH gain 40% and major altcoins push double-digit percentage gains in a wave of short squeezes. That move had triggered over $1 billion in short liquidations — the highest since 2021 — and sent bitcoin briefly past $104,000 before momentum faded.

Markets turned lower during U.S. trading hours Monday after reports of a temporary tariff truce between the U.S. and China, with the removal of several mutual levies and both pledging renewed trade cooperation.

While easing tensions supported equities, the development may have tempered the risk-on narrative that had fueled crypto’s breakout over the past week.

Futures open interest across major exchanges also fell by more than $1.2 billion, suggesting a sharp deleveraging as long traders were forced to exit positions, Coinglass data showed.

Analysts caution that while the near-term flush may reset frothy sentiment, with eyes on the next Fed meeting in June.

“Right now macro concerns are driving the market and the next Fed decision and outlook remarks in June will likely be the key factor in driving Bitcoin past its previous all-time high,” Jeff Mei, COO at crypto exchange BTSE, told CoinDesk in a Telegram message.

“This would stimulate lending and investment in the US economy and hopefully drive growth, avoiding the recession investors are apprehensive about,” Mei added.

How is crypto changing the face of finance? What’s next for stablecoins, tokenization, and Web 3 marketing? How will digital assets be regulated in the future?

These are just some of the questions up for debate as Consensus 2025 kicks off in Toronto this Wednesday. Staged this year at the Metro Toronto Convention Center, crypto’s oldest “big tent” event gets underway at a pivotal moment for the industry.

Crypto is front-and-center in the national conversation and this year’s event will feature many names making news and making waves.

Eric Trump, whose mining startup, American Bitcoin, this morning announced that it plans to go public, is a headline speaker on Thursday.

We’ll hear from Bo Hines, head of the Presidential Council of Advisers for Digital Assets, on the White House strategy to pass legislation on crypto this year.

Dave Portnoy, founder of Barstool Sports, will sit for a fireside chat to discuss crypto culture, memecoins and the future of investing.

There’s an Open Money Summit featuring the biggest names in DeFi, a Brand and Creator Summit for companies positioning themselves for the next phase of the internet, and an AI Summit with a packed schedule of speakers at the intersection of AI and blockchain.

Other headline speakers include Chris Pavlovski (Rumble), Charles Hoskinson (Cardano), Kevin O’Leary (Shark Tank), Adrienne Harris (NYDFS), Justin Sun, David Goyer and dozens more from across the crypto and blockchain industry.

Our Explorations stage will have in-depth discussions on hot topics such as DePIN, crypto policy, staking, advanced trading, and Canada’s Web3 future.

We’ll also have a Hackathon (organized with EasyA), Pitchfest, a Research Symposium (with IEEE), a showing of the movie «Vitalik: An Ethereum Story» with the director (and special guests) and dozens of side-events and parties to attend across Toronto.

For coverage of Consensus 2025 including interviews with speakers, see here.
The full agenda can be found here.

Visit CoinDesk.com for a livestream and ongoing coverage of all the news, rumors and gossip from crypto’s annual gathering.

Education tech firm Classover Holdings (KIDZ) said in early May that it would sell $400 million worth of shares to buy solana. Its stock exploded higher. Shares of the thinly traded company, then with a market cap well shy of $50 million soared from $1.15 to more than $7 in just two sessions before settling back to the current $3.69. .

Classover wasn’t the first company to experience the crypto surge, and it won’t be the last.

A growing number of obscure, microcap and nanocap companies are embracing cryptocurrency — not as a business line or payment method, but as a headline-grabbing balance sheet item. They often follow the same script: an announcement of a shift in strategy to hold digital assets like bitcoin or solana, followed by a pop in the stock price.

Today, GD Culture Group (GDC), a company with a market cap of around $30 million, announced plans to sell up to $300 million in shares to buy bitcoin and TrumpCoin (TRUMP), a meme token themed around U.S. President Donald Trump. The company declared that this purchase was part of its new “crypto asset treasury strategy.” The stock rose 13% on the news.

Also today, Amber International Holdings (AMBR), valued at just under $900 million, said it would allocate $100 million to a basket of cryptocurrencies, including bitcoin, ethereum ETH, solana, XRP, Binance Coin BNB and sui SUI.

All are attempting to mimic the original corporate crypto evangelist: Strategy (MSTR). In August 2020, the enterprise-software company pivoted to using bitcoin as its primary treasury reserve asset. Since then, its stock has soared more than 3,000%, fueled not by software sales or product innovation, but the price of bitcoin. Many retail investors now treat the stock as a proxy for bitcoin exposure.

But while Strategy had a longstanding business and a consistent, transparent strategy — in addition to its chairman, Michael Saylor, emerging early as a bitcoin proponent — these newer companies appear to be leveraging the crypto hype machine with little track record or follow-through.

Take Worksport, a Nasdaq-listed manufacturer of truck bed covers. Last year, the company announced plans to invest its cash reserves into bitcoin and XRP. Its stock, which had been sliding for years, jumped after the announcement. But the rally didn’t last, and the stock has since returned to pre-announcement levels. The company said in April that it had made a six figure initial purchase.

“We are still bullish on our initial positions and have been holding. We will consider adding in the future as appropriate,” a spokesperson told CoinDesk at the time.

The playbook seems straightforward: Find a buzzy crypto token, announce a purchase or strategic allocation, then ride the temporary surge in retail investor attention. In many cases, the amount the company plans to invest vastly exceeds its own market capitalization. That was true for Classover and GD Culture, both of which proposed multi-hundred-million-dollar allocations despite being worth a fraction of that.

It’s unclear whether these companies will actually make their proposed purchases or how they plan to raise the funds. But the market’s reaction points to a pattern: Microcap firms are using crypto as a megaphone.

Still, the tactic is proving effective in the short term. As long as the market rewards crypto-related headlines with stock rallies, small companies are likely to continue jumping on the bandwagon.

Whether any of them become long-term crypto believers like Strategy remains to be seen.

There are, however, some firms that appear to be taking the Strategy route more seriously — and seeing results. Japanese investment firm Metaplanet has steadily grown its bitcoin holdings to 6,796 since launching its Bitcoin Treasury Operations in April 2024, positioning itself as one of the more committed corporate holders in Asia.

Similarly, U.S.-based medical device company Semler Scientific has been buying bitcoin consistently since adopting it as a reserve asset. It now holds 3,634 BTC on its balance sheet, reflecting a strategy that mirrors MicroStrategy’s playbook rather than simply borrowing its headlines.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy.