Asian markets opened the new trading week in a sea of red, with Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP all experiencing significant losses. The sell-off was triggered by heightened concerns over potential tariffs, exacerbated by former U.S. President Donald Trump’s aggressive stance on trade policies expressed on social media over the weekend.
According to CoinDesk Indices, Bitcoin saw an 8% decline in early Asian trading, dropping to $93,100 before stabilizing around $93,900 by the afternoon in Hong Kong. Meanwhile, Ethereum (ETH) plunged nearly 20%, falling below $2,500, Solana (SOL) declined 7% to $193, and XRP plummeted 23% to $2.
The CoinDesk 20 (CD20) index, which tracks the largest cryptocurrencies, has dropped nearly 17%. Additionally, Trump’s memecoin (TRUMP) suffered a 12% loss, and World Liberty Financial (WLFI), a crypto project associated with Trump’s family, saw a 20% decline in its January investments, as reported by SpotOnChain.
According to CoinGlass, nearly $1.3 billion worth of long positions were liquidated in the past 12 hours, including approximately $400 million in long Ethereum positions and $300 million in long BTC positions. This widespread liquidation contributed to a market-wide correction in the crypto space.
The primary catalyst behind this downturn is Trump’s decision to impose 25% tariffs on imports from Canada and Mexico. This move has sparked backlash, with analysts questioning the economic benefits of such tariffs. Over the weekend, the Wall Street Journal published an editorial describing it as “the Dumbest Trade War in History.”
The European Union has strongly opposed the tariffs, with Brussels warning of firm retaliatory measures. A spokesperson for the EU told Politico:
“Tariffs create unnecessary economic disruption and drive inflation. They are hurtful to all sides.”
However, the United Kingdom appears to be the only country that may receive an exemption, as Trump indicated that a ‘workable’ deal could be negotiated, according to a BBC report.
