On Monday, Ethereum, Solana, and other significant altcoins faced a substantial decline as the entire cryptocurrency market plummeted by over 13%, largely in response to a massive selloff in Asian markets, resulting in more than $1 billion in liquidations.
Ethereum (ETH), the top altcoin, dropped more than 19% within just 24 hours, falling to about $1,450. This represents a decline of over 60% for the year. Other well-known cryptocurrencies such as XRP (XRP), Solana (SOL), and Dogecoin (DOGE) also lost important support levels, each experiencing declines of approximately 18–20%.
Overall, the cryptocurrency market saw more than $1.38 billion in liquidations, with a large portion originating from long positions. Specifically, around $1.21 billion was lost by traders wagering on rising prices.
The recent downturn in ETH and other altcoins seems to be predominantly influenced by escalating global tensions stemming from U.S. President Donald Trump’s reinitiation of a tariff conflict. His proposed plan includes a 10% tariff on most imports, increasing to 34% on goods from China and 20% on products from the EU.
Trump argues that the new tariffs will generate additional revenue for the U.S. and address trade complications with China and Europe. However, the markets reacted negatively.
In response, China has implemented its own retaliatory tariffs targeting essential U.S. exports, including agricultural and technology products. Other nations, particularly in the EU and Asia, have also suggested the possibility of similar counteractions, escalating fears of an all-out global trade war.
Markets in China, Taiwan, Japan, and Singapore saw dramatic losses on Monday morning, triggering circuit breakers designed to temporarily halt trading during extreme volatility. Indices across the region declined between 7% and 13% as panic selling took hold among investors.
Bitcoin (BTC) also fell in tandem with the stock markets, dropping over 8% in the last day and dipping below the $76,500 threshold—an important level that analysts warned must be maintained to prevent further declines.
The Crypto Fear & Greed Index saw an 11-point drop within a single day, landing in the “extreme fear” territory, indicating that investors are stepping back from high-risk assets.
This downturn has sparked skepticism about Bitcoin’s effectiveness as a safe haven in times of economic uncertainty, particularly as it declined while gold and other precious metals saw price increases.
Compounding the situation, Fed Chair Jerome Powell remarked that the new tariffs could exacerbate inflation and hinder the U.S. economy. He also noted that there’s no urgency to cut interest rates at this time, a development that isn’t favorable for either cryptocurrency or stock markets, both of which typically perform better when rates are low.
In light of the recent crypto market downturn, Georgii Verbitskii, founder of a crypto investment app, commented that the selloff is not indicative of specific altcoins failing but rather a wider trend of “market stress” driven by macroeconomic uncertainties.
He highlighted Trump’s tariff announcements as a significant factor in creating tension, stating that they triggered a “broad sell-off in risk assets.”
With over $1 billion in liquidations affecting the crypto sector, Verbitskii emphasized that it is understandable for altcoins to suffer. However, he advised a stance of “caution, not panic,” suggesting that the market will likely remain reactive until there’s greater clarity regarding regulatory and macroeconomic issues.
Slava Demchuk, CEO of AMLBot, attributed the crash to a combination of external pressures and internal vulnerabilities. He characterized the situation as “just a storm” rather than an endpoint.
“In the short term, I anticipate continued volatility, but recovery will be contingent upon positive developments, such as a more stable economic policy in the U.S. We should prioritize risk management and focus on long-term fundamentals during this turbulent time,” he said.