In the last 24 hours, Bitcoin and the broader cryptocurrency market have experienced significant selling pressure driven by escalating tariff tensions between the United States and the European Union (EU), creating global uncertainty. Bitcoin’s price swiftly decreased from $95,500 to below $92,500, with this downward pressure extending to major altcoins, primarily Ethereum. This sharp decline in the U.S. markets also triggered substantial liquidations in leveraged positions, revealing the fragility in investor sentiment. Market participants agree that the price movement was shaped not only by technical factors but also by the re-emergence of geopolitical risks as a significant concern.
US-EU Tensions Accelerate Crypto Market Sales
On Sunday, Bitcoin, which was trading at $95,500, plummeted to $92,474 within approximately four hours, losing nearly 3% of its value. During the same period, high-volume altcoins such as Ethereum, XRP, and Solana experienced similar declines. This rapid price pullback highlighted the heavily leveraged nature of the cryptocurrency market once again.
According to Coinglass data, over $750 million in long positions were liquidated within just four hours. Analysts emphasized that the acceleration in liquidations underscored increasing investor sensitivity to macro risks and tightening liquidity conditions. The overall weaker performance of the cryptocurrency market, particularly notable compared to some traditional risky assets that exhibited stable or slight gains during the same period, caught the attention of many observers.
Min Jung, a researcher at Presto Research, noted that cryptocurrencies have recently been lagging behind other asset classes, with trade war concerns clearly impacting sentiment. Jung elaborated that despite a broader recovery trend in global markets, investors are adopting a more cautious stance with respect to the cryptocurrency sector.
Tariff Threat, Policy Uncertainty, and Technical Breakdown
The backdrop of these tensions includes U.S. President Donald Trump’s threat to increase tariffs on some European countries if Denmark refuses to sell Greenland to the U.S. The tariffs, slated to start at 10% in February and rise to 25% by June, target eight NATO members, including Denmark, Germany, France, and the United Kingdom. Reactions from European capitals have been fierce, with preparations for retaliation reported by Reuters.
Rachael Lucas, an analyst at BTC Markets, asserted that the price movement should not be solely attributed to headlines, indicating that weakness in the crypto market began earlier. Lucas pointed out significant factors contributing to the increased uncertainty, such as the suspension of a U.S. bill on cryptocurrency market structure and Coinbase withdrawing its support.
From a technical perspective, Bitcoin dropping below its 50-week average triggered algorithmic selling. The withdrawal of $4.4 billion from spot Bitcoin ETFs in November and December and the reduction in open positions in futures markets reinforced the decline in risk appetite. Lucas noted that, despite ongoing macroeconomic pressures, the price could drop further to the $67,000–$74,000 range, but emphasized that the sector has matured compared to previous cycles.