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Cryptocurrency markets experienced a dramatic collapse on Monday, shedding an estimated $300 billion in value as US President Donald Trump’s aggressive tariff announcements triggered a broad market sell-off. The downturn in digital assets mirrored a sharp decline in traditional equities, with the Dow Jones Industrial Average plummeting 1,100 points and the S&P500 losing $1.5 trillion in market capitalization within hours.
The overall global crypto market capitalization currently stands at $2.75 trillion, or 10.53% down in the past 24 hours.
The market reversal came swiftly after a brief surge on Sunday, sparked by initial reports of a potential US strategic reserve for cryptocurrencies. However, this optimism evaporated as President Trump, in a press conference Monday, unveiled a far-reaching escalation of his trade policies.
The President confirmed the implementation of a 25% tariff on imports from Canada and Mexico, effective March 4th, dismissing any possibility of negotiation, Reuters reported. Further escalating trade tensions, Trump announced increased tariffs on agricultural imports starting April 2nd and hinted at levies targeting countries engaged in currency devaluation. Adding to market anxiety, the White House issued a statement shortly after, confirming a doubling of tariffs on Chinese goods to 20%.
The tariff announcements sparked immediate and widespread selling pressure. Technology stocks were particularly hard hit, with Nvidia (NVDA) leading the decline, falling nearly 9% to its lowest level in 2025. The S&P 500 closed down 1.76% at 5849.7, marking its worst trading day this year.
The cryptocurrency market, initially buoyed by strategic reserve speculation, proved equally vulnerable to the tariff-induced market downturn. Bitcoin (BTC) prices fell below $83,000, representing a 24-hour decline exceeding 10%. Ethereum (ETH) dropped over 16% within the same timeframe. Altcoins previously highlighted in strategic reserve discussions, including XRP, Solana (SOL), and Cardano (ADA), experienced even steeper losses, all declining by over 20%.
Market data from Binance indicates significant liquidation volumes, exceeding $270 million within a single hour and totaling $1.06 billion over 24 hours. This suggests a rapid deleveraging across cryptocurrency markets as traders reacted to the sudden price drops.
As of publication time, Bitcoin (BTC) traded around $84,000, down 9.5% over 24 hours. Ethereum (ETH) stood at approximately $2070, a 15.2% decrease. XRP, Solana (SOL), and Cardano (ADA) traded at $2.29 (-18%), $136.79 (-19.21%), and $0.796 (-25.6%) respectively.
Observers have pointed to President Trump’s omission of any mention of strategic cryptocurrency reserves during his tariff announcement as contributing to the market’s negative reaction. This silence cast doubt on the sincerity and near-term feasibility of the proposed reserve program.
Blockhead
Arthur Hayes, founder of BitMEX, has expressed skepticism regarding the government’s ability to effectively implement a strategic cryptocurrency reserve. Hayes stated in recent commentary that government asset hoarding is often driven by political motivations rather than sound financial principles. He further questioned the financial resources available to the administration to acquire the necessary cryptocurrency holdings, suggesting the recent strategic reserve discussion may be "empty talk" without concrete financial backing or a shift towards Bitcoin as a primary reserve asset.
Nothing new here. Just words. Lmk when they get congressional approval to borrow money and or revalue the gold price higher. Without that they have no money to buy #bitcoin and #shitcoins. https://t.co/Q06cDtL6h7
— Arthur Hayes (@CryptoHayes) March 3, 2025
Ashrith Rao
