Crypto Bloodbath: Markets Tank 6% as Trump Tariffs & Fed Jitters Spark Panic Sell-Off

Crypto just got sucker-punched by macro chaos. Here's why traders are hitting the sell button—and where the smart money might go next.

Trump's trade war 2.0 meets Fed hawkishness

Digital assets bled out as former President Trump's new tariff threats collided with Jerome Powell's rate hike signals. The double-whammy crushed risk appetite across all speculative assets—because nothing says 'stable store of value' like watching your portfolio nosedive before breakfast.

Liquidity vanishes faster than a DeFi exploit

Market makers pulled bids as volatility spiked, creating the perfect storm for cascading liquidations. The 6% plunge erased two weeks of gains in hours—proving once again that crypto 'hedges' against traditional finance about as well as a screen door on a submarine.

Silver lining for degenerates?

While paper-handed investors panic, OGs see opportunity. History shows these macro-driven selloffs create prime buying conditions—assuming you've got the stomach (and dry powder) to catch falling knives. Just maybe wait until after the next Fed speech.

Trump’s Tariffs Spark Crypto Panic

President Donald Trump’s announcement of aggressive new tariffs, ranging from 10% to 50% on imports from over 60 countries, stunned global markets.

Canada was hit with a steep 35% rate, while Southeast Asian countries like Laos and Myanmar saw 40% tariffs, stoking fears of a broader trade war. Investors rushed to reduce exposure to high-risk assets, sending both equities and cryptocurrencies tumbling.

Cryptos, which initially benefitted from expectations of regulatory clarity, quickly turned south as macroeconomic uncertainty overshadowed optimism. The Federal Reserve’s stance to maintain rates while signaling possible economic stagnation further weakened confidence in digital assets.

The crypto crash was intensified by overleveraged positions. ethereum led the liquidation tally with $168.9 million, while Bitcoin saw $144 million in long positions wiped out.

Traders were forced to exit en masse, triggering a cascade of sell orders that accelerated the decline. Altcoins like Solana (SOL), Cardano (ADA), and Dogecoin (DOGE) also recorded losses between 5% and 8%.

Pudgy Penguins (PENGU) and sui (SUI) were among the hardest, dropping by 14% and 10% respectively, hit due to insider token movements and derivative liquidations, adding to market stress.

The sell-off depicts how crypto remains deeply tied to global financial trends. As inflation concerns and interest rate pressures grow, analysts warn of further volatility unless bitcoin reclaims support above $116K.

Attention now turns to upcoming U.S. jobs data, which could influence whether the Fed leans dovish in its next policy meeting. For now, digital assets are trading more like traditional risk assets, showing the market’s need for clearer regulation and economic stability.

Cover image from ChatGPT, BTCUSD chart from Tradingview