Trump’s Tariff Announcement Triggers $2B Crypto Liquidation

• Bitcoin dropped to $92K, triggering $2B in liquidations and altcoin market losses.
• Over 700K traders were liquidated, with Ethereum seeing $600M in total liquidations.
• Trump’s new tariffs raised inflation fears, adding pressure to crypto and stock markets.

With the announcement of new tariffs by President Donald trump, the cryptocurrency market experienced a severe downturn with total liquidations exceeding $2 billion in the past 24 hours, while Bitcoin dropped to $92,000. The sudden decline triggered a ripple effect across the market, impacting altcoins and resulting in widespread losses for traders. More than 700,000 traders faced liquidations, with long positions accounting for $1.76 billion of the total losses.

Trump’s newly announced tariffs contributed to the market’s volatility. The 25% tariff on imports from Canada and Mexico, along with a 10% tariff on Chinese goods, raised inflation concerns. The policy shift caused uncertainty in financial markets, leading investors to exit risk assets, including cryptocurrencies. Analysts warn that these tariffs could increase consumer costs and impact global supply chains, further pressuring the market.

The price drop in Bitcoin created extensive negative impacts on alternative coins because of several key elements. The cryptocurrency market tracks Bitcoin movement since Bitcoin controls overall market sentiment. With Bitcoin price drop, it created panic among investors, resulting in additional altcoin market declines. Almost every altcoin maintains high correlation with Bitcoin thus becoming exposed to its price fluctuations. The market also saw an increase in liquidity withdrawals as investors moved funds to stablecoins to mitigate losses.

Related: Trump Issues Strong Warning Over BRICS Currency Plans

The high volatility resulted in a cascade of forced liquidations in leveraged trades. Many traders were forced to sell assets to cover margin calls, leading to further price drops. Ethereum was among the hardest-hit altcoins, with total liquidations surpassing $600 million. According to Coinglass data, the ETH traders experienced $528 million worth of liquidations whereas the total Bitcoin trader liquidations reached $421 million. 

The price decline affected other major cryptocurrency values to a significant extent. On the other hand, Solana and Dogecoin also faced heavy selling pressure. While DOGE fell by 30%, Sol along with Binance Coin depreciated by 15%. XRP fell by 30%, while ADA lost 35%. Market capitalization of all cryptocurrencies decreased by 8% as investors displayed a negative outlook.

Further, the announcement about new tariffs caused Nasdaq futures to plummet as traders reacted to inflationary risks. According to market observers, Bitcoin may experience additional price declines due to ongoing market declines across all financial sectors. Analysts now await further developments in U.S. trade policy and potential regulatory changes affecting digital assets. 

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