Volatility in cryptocurrency markets has led to over $1 billion in liquidations in the past 24 hours. Fear of an impending trade war has been the main driver of this instability.
Liquidations in the Crypto Market
According to CoinGlass data, more than 87% of liquidations came from long positions. This volatility followed significant losses on March 4 that erased earlier gains. Bitcoin led liquidations with over $300 million in the past 24 hours.
Introduction of Trade Tariffs
On March 4, US President Donald Trump imposed a 25% tariff on goods from Canada and Mexico, the US's largest trading partners. This led to a nearly 2% decline in the S&P 500 index in the morning trading hours.
Impact on Cryptocurrencies
Bitcoin fell to $82,000, while cryptocurrencies like Ethereum and Solana lost about 12% and 20% in value, respectively. These events unfolded after optimism due to plans for a US reserve fund holding various cryptocurrencies.
These developments highlight how macroeconomic factors, such as a potential trade war, can outweigh significant industry news, impacting the market more substantively.
