Crypto Market Suffers $2.2B in Liquidations, With XRP and Dogecoin Falling 25% Amid Tariff Concerns.

XRP, Dogecoin (DOGE), and Cardano’s ADA saw significant declines of over 25%, erasing the gains made since December and returning to levels seen before the U.S. presidential election in early November. This drop comes as global markets react to the impact of new tariffs imposed by the U.S. on Mexico and Canada, raising fears of a global trade war and driving down risk appetite.

In the last 24 hours, the broader cryptocurrency market has been hit hard, with XRP, DOGE, and ADA all losing more than 25%. This has resulted in a broader market slump, with overall market capitalization falling by 12%, marking its biggest drop in over a year. The CoinDesk 20 (CD20) index fell 10%, while Bitcoin (BTC) saw a smaller 6% dip.

Futures markets reflected the sell-off, with Ether (ETH)-linked products experiencing more than $600 million in liquidations, primarily in the early hours of the Asian trading session. XRP and DOGE futures also suffered heavy losses, losing a combined $150 million, while altcoin futures saw $138 million in liquidations. The total liquidation figure surpassed $2.2 billion, the highest level seen this year and among the largest in the last 12 months. The largest single liquidation occurred on Binance, with a $25 million liquidation on a tether-margined ETH trade.

Commenting on the market volatility, Augustine Fan, head of insights at SignalPlus, warned that Ethereum’s sharp 20% drop was especially concerning given the asset’s lack of long-term institutional support. “Ethereum is behaving more like an altcoin in this downturn,” he said in a message to CoinDesk. “We’ve seen massive liquidations, with over $2 billion in futures stop-outs in the last 24 hours, signaling that the markets are likely to remain in a risk-off posture until further developments unfold.”

Liquidations are a common occurrence in the high-volatility world of crypto, particularly when significant market-moving events happen. In this case, the triggering event has been the renewed trade tensions sparked by President Trump’s decision to impose 25% tariffs on goods from Mexico and Canada. These tariffs have already disrupted trade relations between North America’s largest economies, and retaliatory measures are expected from both Canada and Mexico.

Market analysts are concerned that the imposition of tariffs could increase costs on a wide range of goods, from electronics to food, potentially leading to inflation and economic slowdown. The broader ramifications for the global economy, particularly through reduced trade and higher consumer prices, are driving investors to be more cautious, further compounding the current crypto market downturn.