Solana Survives Record $19B Liquidation With 100K TPS Performance

Global cryptocurrency markets witnessed a historic liquidation event, wiping out more than $19 billion in leveraged positions within a single day. According to Coinglass data, over 1.6 million traders were forced out of their positions, marking one of the largest market clearances since 2021. 

The trigger came after former U.S. President Donald Trump proposed a 100% tariff on Chinese imports, sparking widespread panic across financial markets and causing a sharp selloff in both traditional and digital assets.

Source: X

Market Mechanics Trigger Chain Reaction

According to BitMEX co-founder Arthur Hayes, the sudden crash stemmed from how centralized exchanges manage margin trading. When altcoins used as collateral lost value, exchanges automatically liquidated them to cover margin deficits. This triggered a wave of forced selling across assets. 

Market analyst CrediBULL Crypto supported this view, noting that the liquidation cascade occurred due to altcoins’ limited liquidity. As positions unwound, each sale triggered another, amplifying the market downturn. He added that the extreme “wick lows” seen during the crash likely reflected forced selling rather than genuine market activity.

Besides market structure, analysts pointed out that excessive leverage played a critical role. Many traders had opened highly leveraged positions in anticipation of continued gains. Once prices dipped, automated systems triggered a domino effect, draining billions from derivative markets within hours.

Solana Faces Heavy Pressure but Network Shows Strength

Amid the chaos, Solana (SOL) suffered a sharp decline of 17.5% over the last 24 hours, falling to around $183. Its market capitalization now stands at $100.4 billion, with a circulating supply of 550 million tokens. 

However, Solana’s network performance surprised many. According to the core development team at Anza, the blockchain endured its most intense stress test yet, maintaining stability while processing over 100,000 transactions per second. The Agave validator client handled six times the usual peak traffic without any degradation, demonstrating Solana’s scalability under extreme conditions.

Solana ETF Optimism Offers Hope for Recovery

Despite the record losses, optimism remains for Solana’s long-term outlook. Recent regulatory adjustments have made U.S. ETF approval for Solana more likely, potentially opening doors for institutional investment.  Data from The Block shows three Solana-related ETF products are already live, with several awaiting approval.