The cryptocurrency market suffered a massive sell-off, resulting in over $1 billion in liquidations, as traders faced heavy losses following a sudden downturn. According to data from CoinGlass, more than 87% of liquidated positions were long bets, with Bitcoin alone accounting for $370 million in liquidations.
The sharp decline came in response to U.S. President Donald Trump’s announcement of 25% tariffs on Canada and Mexico, which triggered turmoil across financial markets. The S&P 500 dropped nearly 2% in early trading, and the crypto sector followed suit.
Bitcoin, Ethereum, and Solana Suffer Heavy Losses
Bitcoin, which had been trading around $93,000 on March 3, plunged to approximately $82,000 following the tariff news. Other major cryptocurrencies also took a hit—Ethereum fell by 10%, while Solana dropped by 15%. The broader crypto market cap declined by 8%, wiping out nearly $300 billion in value.
CoinGlass data revealed that around 300,000 traders were liquidated in the past 24 hours, with the largest single liquidation order, worth $13.4 million, executed on Bitfinex.
Market Reversal After Trump’s Crypto Reserve Announcement
The downturn marked a sharp reversal from the previous day when markets surged by $350 billion in response to Trump’s announcement on March 2 about creating a U.S. crypto reserve. His statement, which included plans to hold Bitcoin, Ethereum, XRP, Solana, and Cardano in the reserve, had initially fueled optimism among traders. However, the tariff decision quickly led to a dramatic sell-off, erasing those gains.
Analysts believe that macroeconomic concerns—particularly the risk of a trade war—outweighed industry developments, such as the SEC’s dismissal of lawsuits against crypto firms in February.
Bitcoin’s Struggles and Investor Concerns
Bitcoin’s price has been on a downward trend since reaching its all-time high of $108,786 in January. After an initial surge following Trump’s election victory, Bitcoin had already fallen below $80,000 by late February, marking a 26% decline.
The latest drop has intensified concerns about market stability. Open interest in Bitcoin’s price action fell by 12% in the last 24 hours, signaling a cautious wait-and-see approach among traders.
Market Outlook: Is the Bull Run Over?
Despite the downturn, market analyst Ki Young Ju, CEO of CryptoQuant, remains optimistic. He believes that Bitcoin’s bull cycle is still intact, citing neutral on-chain activity and strong fundamentals, including an increase in mining activity. However, he also warned that the slowdown could persist until market sentiment in the U.S. improves.
Altcoins and Stocks Also Take a Hit
XRP, Solana, and Cardano, which had previously surged following Trump’s crypto reserve announcement, were among the hardest hit. The altcoin sector saw over $150 million in liquidations as uncertainty spread across the market.
The broader financial market was also affected—major stocks like Nvidia and Tesla experienced significant declines, reflecting a broader risk-off sentiment.
As uncertainty continues to shape the market, traders and investors remain cautious, awaiting further developments that could either stabilize or further shake the crypto landscape.
