XRP, Dogecoin (DOGE), and Cardano’s ADA experienced steep declines of more than 25%, erasing all gains made since December and returning to pre-U.S. election levels from early November. Over the past 24 hours, major cryptocurrencies saw losses of over 25% as new tariffs imposed by the U.S. on Canada and Mexico sparked concerns of a global trade war, which soured sentiment for risk assets.
These significant drops have caused most major coins to lose 40-50% of their value in the past month, marking one of the sharpest declines in recent years. The total market capitalization dropped by 12%, the largest decrease in over a year, while the broader CoinDesk 20 (CD20) index fell by 10%. Bitcoin (BTC) experienced a 6% loss during the same period.
Futures markets mirrored these declines, with ether (ETH)-based products seeing over $600 million in losses, primarily during the early hours of trading in Asia. XRP and DOGE futures collectively lost $150 million, while altcoin-tracked products experienced $138 million in liquidations. Ether-based futures lost an additional $84 million. In total, liquidations exceeded $2.2 billion, the highest this year and among the largest in the past 12 months. The biggest liquidation was a $25 million tether-margined ETH trade on Binance.
Market observers have warned of further losses in the coming week. “While Bitcoin dropped more than 8% over the weekend, Ethereum’s 20% fall shocked the market, with ETH behaving like an altcoin on the downside. It lacks long-term institutional support and near-term catalysts,” said Augustine Fan, head of insights at SignalPlus, in a Telegram message to CoinDesk. “We saw massive long futures liquidations over the weekend, totaling over $2 billion in stop-outs, marking the sharpest liquidation event in crypto history. Markets are likely to remain in risk-off mode as we await the U.S. equity market open.”
Liquidations occur when traders cannot maintain the necessary margin to keep leveraged positions open. The crypto market’s inherent volatility often leads to these events, but major occurrences like Monday’s selloff provide key signals for future market sentiment and positioning.
The market correction is largely attributed to the renewed trade war sparked by U.S. President Donald Trump’s decision to impose 25% tariffs on imports from Canada and Mexico. This move has disrupted trade relations between North America’s major economies, with both countries threatening retaliation. Financial markets are concerned that these tariffs could lead to higher costs on goods across various industries, from automobiles to agriculture, potentially causing a broader economic slowdown and increasing inflationary pressures.
