Crypto market volatility bounced back from an earlier plunge on a volatile trading day, triggered by President Donald Trump’s latest tariff announcement. The tariff war between the US and its trading partners shook global markets, including the crypto sector, as investors scrambled to assess its long-term impact.
Bitcoin and Major Cryptos Show Resilience
At 2:17 p.m. in New York, Bitcoin hovered around $79,000, nearly unchanged after dropping as low as $74,425 earlier in the day—its lowest point since the day after the 2024 US election. This was a pivotal moment for the crypto market, which had been buoyed by Trump’s return to the White House and the subsequent rally in digital assets, peaking on his inauguration day in January.
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Bitcoin: $79,000 (recovered after a 5.6% dip)
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XRP, Solana, and Cardano: Showed similar recovery after steep declines early Monday
Crypto Market Cap Takes a Hit, But Recovers
The total cryptocurrency market capitalization experienced an 11% decline, dropping to $2.5 trillion, a level last seen after Trump’s victory. Despite the selloff, the market found footing, showing resilience in the face of significant volatility.
Trump Tariffs Stir Volatility Across Global Markets
The impact of Trump’s tariff program reverberated through global equities and crypto markets, dashing hopes that crypto might be less affected by market swings than traditional assets. Stocks in Asia and Europe tumbled, while US equities faced wild swings, with the S&P 500 seeing moves of up to 4.7% in either direction during early trading.
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S&P 500: Swung from -4.7% to +3.4% in just the first hour
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Crypto: Followed a similar trend of significant volatility
Crypto Industry Faces Unexpected Challenges
The crypto industry had been a strong supporter of Trump’s second term, with crypto businesses among the largest donors to his campaign. In return, Trump’s administration had paused or dismissed several high-profile investigations into the sector. However, introducing his tariffs has severely affected market expectations, leading some experts to express concern about the future.
Matthew Graham, CEO of Ryze Labs, a leading crypto-focused venture capital firm, stated:
“Crypto came into 2025 expecting a Trump tailwind and got a Category 5 storm instead. We expected the tailwind, and in return, he stiffed us.”
Record Liquidations and Rising Selling Pressure
The market’s reaction to Trump’s tariffs has been swift. According to Coinglass data, $1.5 billion in bullish crypto positions were liquidated within 24 hours—the largest liquidation event of the year.
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$1.5 billion worth of bullish positions liquidated
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Put options show increased demand for downside protection
The increased demand for protection is reflected in Deribit data, which shows that open interest for Bitcoin put options with a $70,000 strike price is now the highest for any upcoming expiry.
What’s Next for Crypto Amid Market Turbulence?
While Crypto Market Volatility had previously shown some resistance to the market turmoil triggered by Trump’s tariff announcements, Monday’s drastic price swings indicate that the close correlation between crypto and tech stocks, especially the Nasdaq 100, may remain in place.
If you’re navigating this volatile landscape, staying informed and adjusting your strategies is crucial. Crypto investors should continue monitoring market conditions closely to protect their portfolios.
