Crypto Market Sheds $110B as Donald Trump Reinstates Tariffs on Mexico, Canada

Key Takeaways

• The crypto market lost over $110 billion as Bitcoin and altcoins dropped to multi-week lows.
• More than $880 million in leveraged positions were liquidated as traders were caught off guard.
• Analysts suggest renewed Trump tariffs may have influenced the sell-off.

A sharp downturn rattled the crypto market on Monday, wiping out more than $110 billion in market capitalization as Bitcoin and altcoins tumbled to multi-week lows.

The sudden plunge, following weeks of sideways movement, was fueled by renewed macroeconomic pressure and a string of unsettling developments across the digital asset space.

Market analysts pointed to multiple catalysts behind the collapse, including President Donald Trump’s announcement to reinstate tariffs on Mexico and Canada, a wave of outflows from Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs) , and lingering bearish sentiment following the Solana memecoin insider trading scandal.

Over $880 Million in Leveraged Trades Wiped Out

The sell-off triggered one of the largest liquidation events in recent months, with $882 million in leveraged positions being wiped out across the market.

More than 284,000 traders were forced out of positions as prices plunged, with long traders bearing the brunt of the losses.

Total crypto liquidations. Source: Coinglass

Bitcoin tumbled from $96,954 to a monthly low of $90,924, leading to $256 million in long liquidations before briefly rebounding.

Ethereum saw an even steeper decline, dropping over 10% to $2,461, liquidating $176 million in long positions.

Solana suffered the worst decline, plummeting 13% to a multi-month low of $136. The collapse wiped out $83 million in long positions and $8 million in short liquidations.

Cardano founder Charles Hoskinson expressed frustration over the market’s reaction, suggesting that investors had lost sight of long-term fundamentals.

“The industry has set a new record for paperhands. It’s almost like the five-year-old throwing a temper tantrum on the supermarket floor,” Hoskinson wrote.

Trump Tariffs, ETF Outflows, and Market Fear Fuel the Collapse

The downturn coincided with Trump’s decision to reinstate 25% tariffs on U.S. imports from Mexico and Canada.

Earlier in the month, a temporary pause in the tariffs had helped boost market sentiment, but the renewed trade barriers reignited concerns over macroeconomic uncertainty.

Adding to the uncertainty, the Solana memecoin scandal has cast a shadow over investor confidence.

The controversy, which revealed insider trading on major memecoins allegedly endorsed by political figures, triggered an exodus of funds from Solana and spread broader uncertainty across the market.

Meanwhile, Bitcoin and Ethereum ETFs saw significant outflows , further weighing on prices.

According to SoSoValue , Bitcoin ETFs recorded $1.14 billion in outflows over the past two weeks, the largest since their launch, while Ethereum ETFs lost $85.3 million during the same period.

The market is also struggling with the aftermath of Bybit’s $1.5 billion hack , which fueled additional selling pressure as traders rushed to move assets.

With fear gripping the market, the crypto fear and greed index has dropped to 27—firmly in the “fear” zone.

Just last month, the index was at 61, reflecting strong bullish sentiment. A score above 41 typically indicates neutral or bullish sentiment, while anything below suggests fear is dominating the market.