RafiOnChain here. And I'm going to be real with you, I was not planning to write today. Had other stuff going on. Then I opened my phone at like 7am Monday and my entire portfolio was bleeding again and I thought okay fine let's talk about this.

Here's what happened over the weekend in case you missed it.

The Supreme Court, Trump, and the Tariff Chaos Nobody Saw Coming

So on February 20th the US Supreme Court ruled 6 to 3 that Trump's sweeping tariffs imposed under the International Emergency Economic Powers Act were illegal. Markets breathed for about five minutes. Crypto bounced slightly. People started posting hopium.

Then Trump went on Truth Social and basically said lol okay and immediately signed a new executive order imposing a 10% global tariff under a completely different law, Section 122 of the Trade Act of 1974. That one IS legal. The Supreme Court can't touch it. And then by Saturday he raised it further to 15%, the maximum that law allows, calling the court's decision "anti-American" in the same post.

So to recap: Supreme Court kills his tariffs. He finds a different legal basis within hours. Raises them higher than before. That's the environment we're operating in right now.

Bitcoin dipped to $66,500 on the initial headline, bounced to $68,000, then got absolutely smacked on Monday morning when Asian markets opened and the full weight of the news settled in. BTC dropped more than 5% in under two hours, falling from around $67,600 to an intraday low of $64,300. ETH dropped 5.5% to under $1,860. SOL dropped 6.1% to around $77.60. XRP down 1.8% to $1.36. BNB, ADA, DOGE all down 4 to 5.6% across the board. Total open interest across crypto derivatives collapsed to $19.5 billion, down from a January 2026 peak of $38.3 billion. Nearly half the derivatives market gone in weeks.

The total crypto market cap shed nearly $100 billion in value within hours of the Monday open. That's not a dip. That's a hit.

The Liquidation Numbers

Over $458 to $470 million in leveraged positions wiped out in 24 hours according to CoinGlass data. Bitcoin and Ethereum together accounted for nearly 70% of that total. More than $200 million in long positions were wiped out within the first 60 minutes alone. The hourly liquidation spike hit $367 million at its worst, the kind of concentrated forced selling that turns a 3% dip into a 5% crash in under two hours.

And here's the part that really stings. Of the $460 million liquidated, $430 million of those were long positions. 92% longs getting destroyed. People who were betting the market goes up, still holding leveraged positions into a structurally weak market, got absolutely wrecked when the catalyst hit.

More than 136,000 individual traders liquidated in a single day. Real people. Real money. Gone.

The Fear and Greed Index dropped to 5. Not 15. Not 10. Five. That's the second time this month it's hit that level and it matches readings we haven't seen since 2018. For context the index sat at 9 just heading into the weekend and even that felt terrible. Five is a different kind of pain.

But Here's the Thing Nobody's Talking About

While retail was getting liquidated and ETFs were bleeding, whales were doing the opposite.

Glassnode data showed that wallets holding between 1,000 and 100,000 BTC accumulated roughly 230,000 BTC over the past three months. That's $15.59 billion in quiet accumulation while everyone else was panicking. On February 6th when the Fear and Greed Index dropped to 9 the first time, whale wallets absorbed 66,940 BTC in a single day. The largest 24 hour whale inflow since the 2022 bottom at $16,000.

The people with the most money are buying. The people with leverage are getting liquidated. That pattern is not random.

ETF picture is rough though. Bitcoin spot ETFs have now seen five consecutive weeks of net outflows. BlackRock's IBIT alone lost $2.1 billion. Fidelity's FBTC over $954 million. Total ETF AUM dropped from $125 billion to roughly $85 to $94 billion over the past months. When the biggest institutional buyers are systematically reducing exposure, any negative catalyst gets amplified on the way down.

And USDT is showing something that honestly made me pay attention. The 60 day change in USDT supply has dropped to negative $3 billion. CryptoQuant flagged this as only the second time this has happened. The last time was during the FTX collapse when Bitcoin was heading toward $16,000. Large scale USDT redemptions mean institutions aren't just rotating between tokens. They're pulling capital out of crypto entirely.

So Is This the Tariff's Fault?

Not entirely. And this is important to understand.

HashKey Group researcher Tim Sun put it well. The tariff headline was the match. The gasoline was already there. Five straight weeks of ETF outflows. Spot trading volume down 59% week over week before Monday even happened. Open interest already collapsed from $38.3 billion in January to $19.5 billion, with remaining leverage still getting flushed. A Japanese yen carry trade unwind adding extra fuel because when the yen surges, leveraged funds have to deleverage fast and crypto gets hit hard during thin weekend liquidity.

Morgan Stanley strategist Denny Galindo called it "the pin that popped the leverage bubble." The bubble was already inflated. Trump just provided the pin.

VanEck published research on February 20th noting that sellers appeared "exhausted" after the correction from October's highs. Bitcoin had already dropped 29% from $126,000. RSI at extreme oversold levels. The forced selling from ETF outflows and leverage flushes may have largely already occurred before this week.

Which means the tariff dump might have been the last significant flush before stabilization. Or it's the beginning of another leg down toward $58,000 to $60,000 where the 200 week moving average sits. Honestly nobody knows for sure right now.

My Actual Take

Look I've been saying for weeks that this market needed to flush leverage before it could build a real base. We've now had the February 1st Black Sunday event with $2.2 billion in liquidations. We've had multiple $400 to $500 million single day events since. We've had whales accumulating quietly the entire time.

At some point the weak hands run out of positions to close. At some point the leverage gets fully cleared. At some point the macro headlines stop having fresh victims to take out because there's no more overleveraged retail left in the market.

Are we there yet? I genuinely don't know. What I do know is that 136,000 traders getting liquidated on a single tariff tweet is not a sign of a healthy market. It's a sign of a market that still has too much speculation and not enough conviction. And that takes time to work out.

Not adding leverage. Not panic selling. Just watching and waiting for the picture to get clearer. And trying not to check my phone every twenty minutes.

How are you holding up through all this? Drop below. 🚀