Why Is Crypto Down Today? U.S. Sanctions on Russian Oil Shake Markets

It’s not like the cryptocurrency market needed even more uncertainty, but nonetheless, it's here anyway. The market went through another dip on October 22, fueled by geopolitical tensions. This time, however, it’s not about China, but rather Russia. 

The ongoing military conflict in Ukraine took a new turn today. Washington announced new sanctions on Russian oil exports, specifically Rosneft and Lukoil. Markets reacted quickly to the news, as these sanctions hold significant implications for global energy supply and oil prices. 

Speaking of which, crude oil spiked to 60 USD per barrel, up by almost 5% in the day. 

The sanctions are part of a broader effort by the U.S. to pressure Moscow to end the war with Ukraine. It comes just after Russia performed its largest air strike yet on Ukrainian ground. U.S. President Donald Trump postponed a scheduled meeting he'd have had with President Putin today. He also commented that the sanctions  "certainly will have an impact" on the Russian economy, as well as asserting that he hopes Putin becomes open to negotiating peace.

Crypto Market Reacts

Bitcoin was trading at a 2% increase in the day this morning. The upward momentum, however, was offset by risk-off sentiment as the news broke. If the currency was trading near $110k at the start of the day, it later corrected to as low as $106k this afternoon. 

While it explains why Bitcoin is down today, recent price movements indicate that the sanctions announcement may not be as significant as previous developments. $BTC has since reached back to the $107k zone, positioning the asset for another go at  $110,000 later in the week. 

With that said, the sudden sellout did get a few investors off guard. Over half a billion in liquidations took place this Tuesday, most of which were from investors betting that the market would go up. 

Surprisingly, Ethereum registered the most liquidations in the market with $162 million in the previous 24 hours, according to Coinglass. 

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The Light at The End of the Tunnel for Crypto

The vast majority of liquidations in the previous three weeks came after the two largest economies in the world once again clashed due to renewed trade disagreements. Dissatisfied with the control of rare earth products in the global market, President Trump announced on October 10 that he was imposing a 100% tariff on Chinese products. 

To say that crypto reacted poorly to the news would be an understatement. Digital assets saw the largest 1-day liquidation event in history on that date, and the market took such a significant hit that it has yet to fully recover. 

However, we could be heading to a resolution sooner rather than later, or at least that is what the American President hopes to achieve during his visit to South Korea this week. According to Reuters, Trump expects to reach a "fantastic deal with China," emphasizing his good relationship with Chinese President Xi Jinping. 

For crypto, a deal between the U.S. and China could mean the return of liquidity to the market, and potentially, digital assets could regain the strength they had at the start of the month. Trump is expected to meet with Xi on October 31, 2025, during the APEC summit in South Korea.