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Over $2 Billion Wiped Out in Biggest Crypto Crash as Trump Tariffs Cause Market Panic
The global cryptocurrency market has witnessed a staggering 7% crash on February 3, with the total market capitalization plummeting to $3.12 trillion. This drastic dip marks one of the biggest market crashes, resulting in a whopping $2.25 billion in liquidations. According to market analyst Michael Van de Poppe, this liquidation event is more severe than any previous incident following the collapse of FTX and Terra LUNA.
The catastrophic losses have affected over 736,000 traders per Coinglass. Furthermore, a staggering $1.87 billion was lost through long liquidations that precipitated forced selling, ultimately fueling a sharp downtrend. Ethereum (ETH), the largest altcoin, suffered its worst drop since 2021 as it plummeted from above $3,000 to $2,150, before recovering slightly to trade at $2,584.
Other top-10 altcoins have also followed suit in this downward spiral. Ripple’s XRP plummeted by a staggering 17% to a mere $2.27, while Solana (SOL) tumbled below the crucial barrier of $200 after shedding 7%. Cardano (ADA) experienced an eye-watering 20% loss.
Meme coin Dogecoin (DOGE), which has been a favorite among enthusiasts and investors alike, also suffered a massive 17% decline to its lowest point in recent history. The market is currently gripped by fear as traders reassess their positions amid the unfolding uncertainty.
The Trump Tariffs have taken center stage as the primary catalyst for this unprecedented chaos. Bloomberg reports that the tariffs, set to be implemented in the coming days, pose a significant threat to risk assets. This has resulted in widespread panic selling, with investors scrambling to safeguard their positions and limit losses.
The ongoing tariff discussions, coupled with concerns of stagflation and recession, have led traders to abandon ship and sell their risk assets en masse. Trump’s recent election victory had galvanized the market, but these tariffs have undone all the progress made since then. The cryptocurrency market has not seen a decline of this magnitude before, and investors are holding their breath as they try to navigate the treacherous landscape ahead.
The crisis has also spilled over into traditional markets, with Nasdaq futures plummeting by 390 points and S&P 500 futures shedding 1.46% on Google Finance. The consequences of these actions will likely be far-reaching, and we can only hope that a swift recovery is forthcoming to restore market confidence.
Source: zycrypto.com
