TLDR
- Bitcoin dropped 3% from $95,500 to $92,474 in just four hours on Sunday evening
- Over $680 million in crypto positions were liquidated, with $600 million in long positions
- The decline came after President Trump threatened tariffs on eight NATO allies unless Denmark sells Greenland
- Major altcoins fell sharply with Solana down 6.7%, SUI down 10%, and ZCash down 10%
- Analysts say the rally toward $96,000 was driven by derivatives rather than sustained spot demand
Bitcoin fell below $92,500 on Sunday as fears of a potential trade war between the United States and European Union rattled crypto markets. The world’s largest cryptocurrency dropped from $95,500 at 5 p.m. ET to $92,474 by 9 p.m., marking a 3% decline in just a few hours.
Other major cryptocurrencies followed bitcoin’s downward movement. Ethereum, XRP, and Solana all tracked the decline during the Sunday evening selloff.
The sudden drop triggered massive liquidations across crypto markets. According to Coinglass data, over $680 million in positions were liquidated in a 24-hour period. Roughly $600 million came from long positions, indicating that bullish traders were caught off guard by the sharp reversal.
Altcoins suffered heavy losses during Monday morning trading in Asia. Solana fell 6.7%, while SUI and ZCash each dropped 10%.
🌍 Trump Unveils Europe Tariff Plan Tied to Greenland
President Trump says the U.S. will impose 10% tariffs on Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands and Finland – rising to 25% unless a deal is reached for the U.S. to acquire Greenland.
He frames the… pic.twitter.com/YN0aVvva8g
— Trader Edge (@Pro_Trader_Edge) January 18, 2026
The market turbulence followed President Donald Trump’s threat to impose escalating tariffs on eight NATO allies. The tariffs would start at 10% on February 1 and rise to 25% by June on imports from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland. The ultimatum demands that Denmark agree to sell Greenland to the United States.
European leaders called the demands “blackmail” and warned of a dangerous downward spiral in transatlantic relations, according to Reuters. EU officials are preparing retaliatory measures, including potentially restricting American services in Europe, imposing new taxes on U.S. companies, or limiting investments in the EU.
Market Weakness Beyond Headlines
Min Jung, associate researcher at Presto Research, said crypto continues to show weakness compared to other asset classes. While US-EU trade war concerns have impacted sentiment, other risk assets like South Korea’s KOSPI are trading flat to higher. This suggests crypto-specific weakness persists, with investors favoring other risk assets.
Rachael Lucas, crypto analyst at BTC Markets, said the trade war headlines injected fresh volatility into an already uneasy market. However, she noted the headlines are not the fundamental driver of the current pullback.
Crypto market sentiment had already been deteriorating after the U.S. crypto market structure bill stalled. After Coinbase withdrew its support, the Senate Banking Committee postponed its markup hearing with no new date announced.
Bitcoin bounce setup forming! 🚨$BTC just swept liquidity into a rising trendline that has held multiple times.
That yellow circle is the key area I’m watching.
Price rejected quickly and reclaimed above the intraday low, which is what you want to see if buyers are still in… pic.twitter.com/lbP1fCYKD6
— CryptoBusy (@CryptoBusy) January 19, 2026
Bitcoin has spent months consolidating after reaching an all-time high near $126,000 in October 2025. Traders have been steadily taking profits after an extended period of volatility. The recent break below the 50-week moving average triggered algorithmic selling.
Derivatives-Driven Rally Fades
Glassnode’s weekly report indicated bitcoin’s advance toward $96,000 was largely driven by derivatives flows, including short liquidations, rather than sustained spot accumulation. The on-chain analytics firm noted that futures liquidity remains relatively thin, leaving price action vulnerable to sharp reversals.
Bear market rally?
Price is nearing the 365-day MA, where the last bear market rally was rejected in 2022.
Sentiment feels euphoric, but indicators still point to a bear market. pic.twitter.com/NTS09qehVO
— CryptoQuant.com (@cryptoquant_com) January 16, 2026
CryptoQuant characterized the move since late November as a potential bear market rally rather than the start of a new uptrend. Bitcoin remains below its 365-day moving average near $101,000, a level that historically acts as a regime boundary.
Spot Bitcoin ETFs shed $4.4 billion through November and December. Futures open interest fell sharply, signaling reduced appetite for risk.
There are some signs of stabilization in the market. Long-term holder distribution has slowed compared with late 2025. Spot flows on major exchanges like Binance have turned more buyer-dominant, while Coinbase-led selling has eased.
Lucas said bitcoin may fall to the $67,000 to $74,000 region if macro pressures persist. CryptoQuant and Glassnode both noted that sustained spot demand has not re-emerged, leaving bitcoin sensitive to leverage and liquidity shifts.
