Bitcoin (BTC) fell more than 4% on Tuesday, down from $92,000 earlier in the day to under $89,000, as $1.8 billion was liquidated across the market amid renewed tariff threats from U.S. President Donald Trump on Europe and a sell-off in equities and bond markets.
Ether (ETH) also experienced a 7.3% dip as it currently trades under $2,955. The crypto plunge aligns with sharp losses for U.S. equities, with the S&P 500 and the Nasdaq Composite both closing more than 2% lower yesterday, while the Dow Jones Industrial Average closed down 1.76%. CNBC reported that this was the worst trading session for all three major U.S. benchmarks since October.
Trump EU Tariff Threat Sends Bitcoin Under $90K, $1.8B Liquidated
BTC dropped to its lowest level since December 31, 2025, on Tuesday, as more than $1.8 billion in long and short positions were liquidated over the past 48 hours. According to data from CoinGlass, around 93%, or about $999 billion, of these were long bets expecting prices to increase. This liquidation event has effectively wiped out all gains made by the alpha cryptocurrency this year, pushing it down 10% from its year-to-date high of just under $98,000. Bitcoin has also fallen below its 50-day exponential moving average (EMA), which served as support during the latest rally.
Liquidation occurs when a trader’s positions in a particular market are forcefully closed due to significant losses or insufficient margin to meet the maintenance requirements. The overall crypto market collectively lost $225 billion in market capitalization, marking its largest decline since mid-November, with total value now sitting at $3.08 trillion.
Market analysts pointed to a combination of leverage unwinds and macro headwinds. Kronos Research CIO, Vincent Liu, noted that the sell-off was driven by a risk-off macro backdrop and a leverage flush that triggered “cascading liquidations.” He also added that rising trade tensions between the U.S. and E.U., weakness in the Japanese bond market, and reduced pension exposure to U.S. Treasuries have weighed on global risk assets, including crypto.
Trump’s latest tariff threats have prompted the return of the so-called “Sell America” trade as equities, treasuries, dollar, and BTC were down, while gold and silver gained. This pattern first emerged after the President’s Liberation Day tariff announcement at the White House in April 2025.
Panic Selling Sends Japan Bond Yields to Records as Gold Hits New ATH
Peter Chung, head of research at Presto Research, said that the epicenter of the sell-off was not in the U.S. but in Japan, where the sell-off of Japanese government bonds started a panic across the board, given that the country is the largest holder of U.S. Treasuries outside of America. Heavy bond selling pushed yields on long-term Japanese government debt to multi-decade highs, with 10-year yields jumping nearly 19 basis points (bps) over two days – marking their sharpest rise since 2022, while 30-year yields recorded their biggest increase since 2003.
Meanwhile, gold recorded a new all-time high of $4,835 per ounce on Tuesday.
U.S. Treasury Secretary Scott Bessent noted that the markets are going down because the Japanese bond market had a six-standard-deviation move over the past two days, and it has nothing to do with the Trump administration’s plans to buy Greenland for national security purposes – a key topic of debate between the U.S. and its European allies.
U.S. Spot Bitcoin, Ether ETFs See $713M in Single-Day Outflows
Amid the ongoing macro-led market turmoil, U.S. spot Bitcoin and Ether exchange-traded funds (ETFs) posted a combined total outflow of around $713 million on Tuesday. According to data from SoSoValue, spot Bitcoin ETFs recorded a total daily net outflow of $483.4 million across eight funds, with Grayscale’s GBTC leading the charge with $160.8 million, followed by Fidelity’s FBTC with $152 million exiting the fund.
At the same time, spot Ether ETFs recorded $230 million in net outflows across six funds, with BlackRock’s ETHA shedding $92.3 million in 24 hours. This marked the end of a five-day streak of positive flows for the investment products tracking the spot price performance of the world’s second-largest cryptocurrency by market cap. Spot XRP ETFs reported $53.3 million in net outflows, their largest single-day outflow yet, while spot Solana ETFs recorded $3 million in net inflows for the day.
Jeff Mei, COO at BTSE, said that Trump’s tariff threats over Greenland have not been well-received by the market – but he noted that, like in the past, the U.S. President is expected to water down his threats to avoid too much damage to global markets. Mei added that traders are closely watching how Europe will respond and whether the situation will escalate any further.
Meanwhile, LVRG Research director Nick Ruck said the ETF outflows reflect a temporary institutional derisking event driven by geopolitical tensions, rather than a rejection of the crypto market’s long-term value proposition.
At the time of writing, Bitcoin (BTC) is trading at $89,019 – down 2.07% in 24 hours.
