Altcoins crash as Bitcoin slips and liquidation risks increase

April 1 wasn’t funny for altcoin holders. Several altcoins, including ACT, suffered sharp crashes. ACT dropped 58% in under an hour, losing $96 million in market cap. Memecoins like HIPPO and KISHU also plunged. The sudden sell-off came after Binance changed leverage and margin tiers.

This update triggered a $3.8 million liquidation for one whale. The broader market stayed mostly stable, but the altcoin market took a big hit. Panic spread fast. Some blamed Binance’s changes. Others pointed fingers at trading firm Wintermute, but its CEO denied involvement.

Bitcoin and ETH Drop After Weak U.S. Data

Bitcoin (BTC) and Ethereum (ETH) also faced pressure. On the same day, both fell sharply after disappointing U.S. economic data. Manufacturing PMI came in weak, and JOLTS job data missed expectations. BTC dropped below $83,000, down from a daily high of $84,400. ETH and other top tokens followed.

These economic numbers added to existing fears. The U.S. Federal Reserve has yet to cut interest rates. Meanwhile, trade war tensions are rising as Trump pushes new tariffs. Altcoins and Bitcoin are now moving on both crypto and macro signals. Traders are watching every headline.

Liquidation Risks Rise as Volatility Spikes

With sharp moves in both BTC and altcoins, liquidation risks are growing. Binance’s margin rule changes caught many traders off guard. Some long positions were wiped out fast. Whales weren’t spared either. A large ACT position was liquidated within minutes.

This has made traders nervous. Liquidation cascades can spread fast in crypto. Even stablecoins like USDT are in the spotlight as traders move funds to avoid risk. More margin calls could hit if prices keep falling. For now, altcoins look the most exposed.

Altcoins Under Fire, but Bull Run Might Survive

Despite the crash, some analysts say the bull run isn’t over. BTC closed March above a key Fibonacci level, which keeps the bullish case alive. Kevin Capital, a well-known crypto voice, called this a “correction phase.” He believes BTC could bounce back stronger.

MicroStrategy keeps buying, showing strong whale support. The firm just bought over 22,000 BTC. That kind of move sends a message. Even if altcoins are struggling now, the bigger picture for BTC remains bullish. If Bitcoin recovers, altcoins could follow later.

Altcoins Facing Uncertainty from All Sides

Altcoins are caught in a storm. Weak macro data, Binance policy changes, and rumors about firms like Wintermute have shaken confidence. There’s no clear explanation yet for the April 1 altcoin wipeout. Some suspect a hack. Others say it was panic selling or forced liquidations.

Wintermute denied dumping altcoins, but speculation won’t stop until there’s more clarity. Meanwhile, projects like Act I are scrambling to calm their communities. They’re promising investigations and response plans. Until the dust settles, altcoins will remain under pressure—and traders will stay cautious.