Trade wars unleashed by US President Donald Trump have caused panic and fear among cryptocurrency holders. Against this backdrop, many digital assets have seen sharp declines.
On February 24, Trump announced the imposition of a 25% tariff on imported goods from Canada and Mexico. The US president's statement triggered a sell-off in the virtual currency market. As a result, nearly $917.9 million in crypto positions were liquidated within 24 hours, $844.7 million of which were long positions. In this environment, the total market capitalization of digital assets plummeted by 4.7% to $2.98 trillion.
The so-called Fear and Greed Index also crashed. In one day, the indicator dropped from 49 to 25 points, moving from neutral territory to "fear" territory. Even Bitcoin holders succumbed to fear, actively unloading their coins. This caused the BTC price to fall below $91,000 before correcting to $92,266.
According to analysts, Bitcoin's drop came after Trump's speech. Experts at the Bitfinex cryptocurrency exchange attributed the weakness in BTC and other cryptocurrencies to macroeconomic uncertainty. Experts estimate that the US president's actions destabilize the situation and increase the risk of inflation. As a result, investors are reluctant to put money into risky assets. Last week, they withdrew $552.5 million from Bitcoin ETFs amid heightened caution.
Notably, market participants have repeatedly tried to break the historic BTC high reached in January 2025. Traders sought to continue the bullish rally but faced failure. "The momentum required for a sustained breakout has been lacking, and this has led to a period of contraction and consolidation across almost all major crypto assets," Bitfinex concluded.
