Cryptocurrencies plummeted as risk assets weakened and demand for safe-haven assets increased following President Trump's announcement of new tariffs on eight European countries.
In the early Asian trading session on Monday (January 19), $Bitcoin (BTC.CC)$ Bitcoin plunged by 3.6%, falling below $92,000, while other tokens experienced even sharper declines. The second-largest digital asset, $Ethereum (ETH.CC)$ Ethereum, dropped sharply by 4.9%, and $Solana (SOL.CC)$ Solana plummeted by 8.6%. As of the time of writing, losses for these cryptocurrencies had narrowed somewhat.
Over the weekend, Trump announced that a 10% tariff on goods from eight European countries would be imposed starting February 1; unless an agreement involving 'the purchase of Greenland' is reached, the rate will increase to 25% in June.
Affected by this development, U.S. stock index futures fell at the start of Monday’s trading session, while the safe-haven asset, $XAU/USD (XAUUSD.CFD)$ and $XAG/USD (XAGUSD.FX)$ gold, surged to a record high.
(Original source: Bloomberg)
On January 17 local time, U.S. President Trump announced on his social media platform 'Truth Social' that all goods exported to the U.S. from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland would face a 10% tariff starting February 1, 2026. Starting June 1, 2026, the tariff rate will increase to 25%.
Trump stated that this tariff measure would remain in effect until an agreement is reached on the 'complete and total purchase of Greenland.'
Trump’s remarks drew criticism from European leaders, with Europe now preparing to suspend approval of the trade agreement reached last year.
On January 18, eight European countries issued a joint statement warning that the threat of additional tariffs undermines transatlantic relations and risks triggering a dangerous vicious cycle. The eight nations pledged to respond in a 'united and coordinated' manner.
After experiencing a downturn at the end of 2025, digital assets had initially shown a promising start to the year. However, the market had yet to achieve a sustained recovery following the severe sell-off in October of the previous year.
Driven by strong inflows into a group of US-listed Bitcoin exchange-traded funds (ETFs), Bitcoin rose to nearly $98,000 on January 14.
Richard Galvin, co-founder of hedge fund DACM, stated that this was seen as a rebound from 'an oversold level caused by year-end tax-loss selling and overall capitulation selling.'
Galvin added that the latest round of tariff concerns brought this rebound to a halt; meanwhile, gold hitting record highs confirmed that the sell-off was 'more of a flight-to-safety move rather than an issue with cryptocurrencies themselves.'
Data from CoinGlass showed that approximately $600 million worth of bullish cryptocurrency bets were forcibly liquidated within the past 24 hours.
BTC Markets analyst Rachael Lucas stated that if the current support level fails, traders believe the next target will be $90,000; "while bulls argue that institutional demand could form a potential bottom."
Editor/Doris
