Bitcoin, Ethereum, and the broader cryptocurrency market faced a sharp sell-off after renewed fears of a trade war between the United States and the European Union rattled already fragile market sentiment.
According to the TradingView data, Bitcoin fell from $95,500 at 5 p.m. ET on Sunday to $92,474 by 9 p.m., a decline of roughly 3% within four hours. Ether, XRP, and Solana all went down the same path, which caused major digital assets to lose value.
The sudden downturn triggered heavy liquidations across derivatives markets. Data from Coinglass, aggregated from publicly available sources, showed more than $750 million in long positions liquidated within four hours. Total liquidations later climbed above $875 million over a 24-hour period, with the majority tied to bullish positions.
🚨 $875 Millions have been liquidated in the past 24 hours as Bitcoin fell below $92,000.
— HodlFM (@Hodl_fm) January 19, 2026
The largest single liquidation order happened on @HyperliquidX - $BTC-USDT value $25.83M. pic.twitter.com/iK0D2AGJO8
Trade war headlines hit crypto sentiment
The sell-off was attributed to rising geopolitical tension after U.S. President Donald Trump threatened new tariffs against several European countries. Trump stated that tariffs would start at 10% on February 1 and rise to 25% by June unless Denmark agreed to sell Greenland to the United States.
The proposed measures targeted imports from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland. European leaders responded forcefully. Reuters reported that officials described the move as “blackmail” and warned of a “dangerous downward spiral” for transatlantic relations.
EU policymakers have since discussed retaliatory options. These include restrictions on U.S. services, new taxes on American firms, limits on investment access, and delayed tariffs worth up to 93 billion euros.
“The crypto market continues to show weakness relative to other asset classes,” Min Jung, associate researcher at Presto Research, said. “While U.S.-EU trade war concerns have had the largest impact on sentiment, other risk assets, including the KOSPI, are trading flat to higher. This suggests that crypto-specific weakness persists.”
Leverage flush exposes market fragility
Bitcoin dropped almost $3,500 within hours on Coinbase, falling from $95,450 to below $92,000 during early Monday trading.
“Despite strong ETF inflows, Bitcoin’s pullback to about $92K highlights a derivatives-driven market,” Vincent Liu, CIO of Kronos Research said. “Over-leveraged long positioning built on shallow liquidity unraveled on reversal, triggering forced liquidations.”
Altcoins recorded deeper losses, dragging total crypto market capitalization down by nearly 3% to around $3.14 trillion. The market has shed more than $110 billion in value since last Thursday.
Macro risks overshadow crypto-specific drivers
Crypto markets now react more to political developments than internal cycles. Bitcoin’s traditional four-year cycle has lost relevance as policy announcements dominate price action.
“The recent pullback in Bitcoin is driven less by crypto-specific fundamentals and more by a broader shift in global risk sentiment,” Ryan Lee, chief analyst at Bitget said in the statement.
Gold and silver prices surged during the same period. Gold futures reached record highs near $4,670 per ounce, while silver climbed above $93. The divergence highlighted a shift toward traditional safe-haven assets.
Meanwhile, uncertainty persists around a U.S. Supreme Court case that could determine whether Trump had authority to impose sweeping tariffs under emergency powers. A ruling against the administration could force refunds exceeding $100 billion, according to the Tax Foundation.
Oleksii Shumak
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