The cryptocurrency market is experiencing significant turmoil, having witnessed a steep decline over the last two consecutive days. This downturn is reportedly tied to recent geopolitical developments, particularly the announcement of a 100% tariff imposed on China by President Donald Trump, which has raised concerns of an impending trade war.
As of Sunday, the total market capitalization of the cryptocurrency sector has dropped sharply to $3.7 trillion, down from a record high of $4 trillion just the previous week. Current trading volume stands at approximately $250.02 billion, according to data from CoinMarketCap.
Leading the market, Bitcoin was valued at $111,660.41, and Ethereum was priced at $3,817.26. Over the past 24 hours, the broader crypto market has seen a decline of 0.89%, contributing to an overall seven-day drop of 11.5%.
Market analysts have identified the combination of Trump’s tariffs and limitations on U.S. software exports as catalysts behind this volatility, which has sparked fears of wider economic ramifications. Data from Coinglass indicates that the market has faced over $19 billion in liquidations, with more than 1.6 million traders impacted. Notably, nearly $7 billion worth of positions were liquidated within the first hour of Friday’s trading session alone.
Brian Strugats, head trader at Multicoin Capital, expressed concerns about the potential for a broader market contagion. He commented, “The focus now turns to counterparty exposure and whether this triggers broader market contagion.”
Adding to the uncertainty, open interest among traders has decreased by 18%, reflecting a diminished appetite for risk in the current market environment. Analysts characterize this decline as a result of both macroeconomic shocks and excessive leverage, marking one of the worst periods for cryptocurrencies since the first quarter of 2025.
In recent trading sessions, Bitcoin was seen trading at $111,773.13—down close to 11% over the past week—while Ethereum was trading at $3,842.09, experiencing a 16% decrease in the same timeframe.
As traders brace for potential consequences stemming from these geopolitical tensions, the outlook for the cryptocurrency market remains precarious, with many analysts urging caution moving forward.