More than $2 Billion worth of cryptocurrencies have been liquidated after Trump's tariffs went into effect

Once again, the market is being affected by certain international policies. In this context, Trump has imposed tariffs on Mexico and Canada for 25% on their products, while China receives a 10% tariff on imports. This in turn triggered a response from these countries, such as Canada, imposing a 25% tariff on products coming from the United States. This means that this percentage covers a large number of products, estimated to be worth close to $155 billion dollars. On the other hand, Mexico is planning something similar, and in another case, China is planning to file a complaint with the World Trade Organization.

This approach makes sense as an implicit strategy to deal with the fentanyl trade in the aforementioned countries, so if fentanyl production and trafficking can somehow be drastically reduced through policies that strengthen controls, the tariffs that had been imposed could be removed.

As a result, global markets have been impacted to the downside, mainly in U.S. equity futures, but triggering a series of considerably large liquidations in the cryptocurrency sector. The repercussions were already being felt on Sunday, affecting Dow Jones futures, taking it down by 1.2%, while S&P 500 and Nasdaq futures, have been impacted by 1.9% and 2.7% respectively.

As for cryptocurrencies, which is what we tend to give the most interest to because we are more immersed in this environment, we witnessed a decline in market capitalization worth $3.2 trillion, down 9.7% at the time of writing. Bitcoin, which is the leading cryptocurrency, has seen a drop to $94,000, although it was worth $92,400 yesterday. Ethereum, on the other hand, has taken a much more substantial fall, marking a 12.5% drop. At this very moment, its price is at $2,600, while yesterday it was above $3,000.

As for settlements, CoinGlass offers us data in which we can appreciate the liquidation of several cryptocurrencies for considerable values, which in total are close to the figure of $2.3 billion in the last 24 hours. According to experts, volatility could persist as new news arrives that could change the outlook for cryptocurrency traders or investors towards absolute uncertainty, and as expected, it will be reflected in the market.

One of the Australian analysts at the Swyftx exchange has mentioned that this week we might have news on data that will provide us with information on non-farm payrolls and unemployment rates. Taking this into account, it could be that the uncertainty that exists now will be cut, although that could derive in a response that we could consider negative towards the market, since as we can understand, everything is related and the market reacts in many cases in an exalted way.

Another person who adds something to question is Forster of Derive. He adds that if interest rates are increased, it could correspond to conditions that do not favor cryptocurrencies. In other words, if interest rates are maintained or increased, what will be created will be indebtedness in the markets. For this reason, he thinks that in the coming quarters, a contraction in the cryptoasset market could be seen.