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HomeNewsAltcoin Bloodbath: Ether, Cardano, and XRP Sink as Trump’s Tariffs Bite

Altcoin Bloodbath: Ether, Cardano, and XRP Sink as Trump’s Tariffs Bite

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  • Major altcoins, including Ether, Cardano, and XRP, plunged double digits as Trump’s tariffs on China, Canada, and Mexico triggered a sharp market sell-off, wiping billions from the crypto market cap.
  • Analysts warn of prolonged uncertainty, with Bitcoin showing relative resilience as traders shift from riskier altcoins.

The cryptocurrency market faced a brutal sell-off as major altcoins, including Ethereum, Cardano, and XRP, nosedived in response to U.S. President Donald Trump’s first round of tariffs on imports from China, Canada, and Mexico. The market turmoil resulted in billions being wiped from the total crypto market capitalization within hours.

Focusing on ETH, the second-largest cryptocurrency by market capitalization after Bitcoin, led the decline, down grading 16% in a single hour to hit $2,368 on February 3 at 2:11 am UTC. While it has since rebounded slightly to $2,521, it remains down 38% from its December 17 peak of $4,078, reached nearly six weeks after Trump’s presidential victory.

Other leading altcoins followed suit, with Avalanche, XRP, Chainlink, and Dogecoin shedding over 20% of their value in the last 24 hours. The overall crypto market cap took an 11.4% hit, dropping to $3.17 trillion.

Market Analysts Weigh In

Markus Thielen, founder of 10x Research, explained that the sharp decline in altcoins was due to a combination of stop-loss triggers and a noticeable lack of buying pressure from retail investors.

The sharp drop in altcoins reflects a wave of stop-loss triggers combined with a buyer’s strike from retail investors, Thielen told a leading news outlet.

He also noted that trading volumes had been in decline for weeks, signaling waning investor interest and conviction.

Thielen further pointed out that while the market was aware of potential tariffs, they were not priced in ahead of time due to investors being preoccupied with DeepSeek news over the past week. The market now faces a period of prolonged uncertainty rather than a short-lived shock, he added.

The effects of the tariffs were felt beyond the crypto market. Nasdaq 100 futures plunged 2.7% on February 3, with the S&P 500 and Dow Jones Industrial Average futures also dropping 2% and 1.5%, respectively. The downturn added to concerns that a broader risk-off sentiment could weigh on speculative assets, including cryptocurrencies.

This sentiment shift was evident in the Crypto Fear & Greed Index, which fell 16 points into the “Fear” zone, reaching a score of 44 out of 100. This marks the lowest reading since October 11, indicating growing investor anxiety.

Bitcoin Resilience and Dominance Surge

While Bitcoin (BTC) was not immune to the sell-off, its losses were milder in comparison to altcoins. Bitcoin fell 6.8% in the last 24 hours to $94,743 but saw a rise in dominance, climbing from 61.1% to 64%, according to TradingView data.

Rising Bitcoin dominance without a corresponding increase in overall crypto market cap suggests that risk-averse traders are rotating out of altcoins and into Bitcoin,Thielen noted.

This movement highlights Bitcoin’s role as a relative safe haven in times of market turbulence.

 

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