A sweeping new trade move by U.S. President Donald Trump has rocked the global cryptocurrency market. After Trump announced a 100% tariff on Chinese imports, digital currencies suffered their largest liquidation in history, totaling $18.28 billion, according to data platform CoinGlass. The sell-off unfolded rapidly on Friday afternoon, exposing deep leverage risks across major exchanges. Bitcoin, ether, and solana were among the hardest hit, wiping billions from investor portfolios in hours. The event came as U.S. stock markets also stumbled, with the Nasdaq and S&P 500 recording their steepest declines in six months. CoinGlass reported that about $5 billion in bitcoin positions were liquidated within 24 hours, alongside $4 billion in ether and $2 billion in solana. Analysts called it the “largest liquidation event in crypto history,” highlighting how quickly fear can spread in the highly leveraged digital asset market. Bitcoin, which recently reached record highs under Trump’s crypto-friendly policies, fell nearly 10% over five days. It dropped to $103,000 before rebounding slightly to $111,616 by Friday afternoon. Ether slid 14%, from $4,365 to $3,742, while solana plunged nearly 20%, from $223 to $178. The crash comes only a week after Bitcoin hit an all-time high of $124,000. Trump’s recent executive order allowing cryptocurrencies in 401(k) retirement plans had fueled optimism and heavy investment. His administration’s softer stance on digital assets had turned him into an unexpected ally for crypto traders, many of whom praised his efforts to bring legitimacy to the industry. But the sudden tariff escalation against China reversed that sentiment overnight. Trump announced on Truth Social that his administration would impose a 100% tariff on all Chinese imports starting November 1, 2025. He framed the move as a response to China’s “extraordinarily aggressive” trade actions, but markets saw it as a direct threat to global economic stability. The announcement rattled financial confidence across sectors. Investors rushed to pull profits from volatile assets like crypto, triggering forced liquidations. In simple terms, leveraged traders who borrowed funds to bet on rising prices were forced to sell when the market turned, amplifying losses and accelerating the crash. Economists warn that the combination of high tariffs and volatile crypto markets could further strain investor confidence. “This is a reminder that political shocks can hit risk assets first,” said a market analyst. “Crypto markets move fast, and fear spreads even faster.” Despite the crash, experts believe the long-term outlook for digital currencies remains stable, citing strong institutional adoption and continued policy support for blockchain innovation. However, short-term volatility is likely to persist as global trade tensions deepen. Trump’s evolving relationship with the crypto industry has been a rollercoaster. Once a vocal critic who dismissed bitcoin as “thin air,” he has since embraced digital assets, even launching his own meme coin earlier this year. His pro-crypto policies — including the proposed “strategic crypto reserve” — had fueled market optimism before this sudden reversal in sentiment. The renewed trade tension between Washington and Beijing adds another layer of uncertainty. China recently tightened export restrictions on rare earth minerals essential for U.S. technology and defense manufacturing, prompting fears of a wider economic conflict. For now, investors are bracing for a turbulent few weeks as markets digest the impact of Trump’s tariff plan. With $18 billion already wiped from the crypto sector, analysts say recovery will depend on whether tensions ease — or if the trade war escalates further.