Crypto Market Extends Losses as Tariff Uncertainty Weighs on Investor Sentiment

The cryptocurrency market recorded losses for the second consecutive day on Thursday as President Donald Trump’s tariff announcements continued to fuel market uncertainty.

Bitcoin (BTC) recorded a slight 0.5% increase over the past 24 hours, trading at approximately $87,087. Meanwhile, Ethereum (ETH) declined by 0.2% to $2,015, while XRP saw a steeper drop of 2.7%, falling to $2.34. Solana (SOL) also declined, slipping 0.8% to $138. The total cryptocurrency market capitalization fell by 2% in the past 24 hours to $2.95 trillion, according to CoinGecko.

Total liquidations over the past 24 hours reached $223 million, with Bitcoin (BTC) accounting for $52 million and Ethereum (ETH) for $43 million, according to CoinGlass data. Altcoins collectively suffered $28 million in liquidations.

Macroeconomic Uncertainty

Experts say today’s cryptocurrency market decline is driven by several factors, but mainly the Trump administration’s upcoming tariffs. Set to take effect on or after April 2, these tariffs will impact several US trade relationships.

"The newly-announced tariff expansions are creating significant turbulence across traditional financial markets, and this macroeconomic uncertainty is spilling over into digital assets as institutional investors recalibrate their risk exposure,” Anthony Anzalone, CEO and Founder of XION, told The Defiant.

Anzalone noted that crypto is becoming increasingly linked to traditional finance (TradFi), highlighting its growing role in mainstream investments rather than functioning as a separate asset class.

“We're seeing heightened caution among traders ahead of April 2nd, a date marked with considerable significance for market-moving announcements and potential policy clarifications,” he said. Anzalone explains that the combination of this looming catalyst event alongside broader economic concerns has “prompted a wave of profit-taking, particularly among investors who experienced substantial gains during the recent rally.”

However, Anzalone emphasized that this pullback should be considered part of normal market fluctuations rather than a sign of fundamental weakness in the crypto ecosystem. “Underlying on-chain metrics remain relatively robust, suggesting this correction may present strategic entry opportunities for investors with appropriate risk tolerance and longer time horizons,” he added.

Trade War

Most recently, Trump announced new 25% tariffs on foreign-made cars and auto parts, set to take effect on April 3, as part of broader trade measures.

“The 25% tariff on car imports and retaliatory measures from key trading partners have weighed on global equities, particularly in Japan and South Korea, where automobile stocks have seen the sharpest declines,” said Agnes Linge, head of growth at decentralized on-chain bank WeFi.

This announcement is the latest in a series of sweeping trade measures targeting Mexico, Canada, China, and countries that purchase Venezuelan oil. However, it remains unclear what policies the administration will ultimately implement.