Crypto Markets Slide Amid Trump Trade Shocks

The cryptocurrency market slid on Wednesday, with Bitcoin (BTC) and Ethereum (ETH) both slipping more than 1%, amid broader macro uncertainty following new trade announcements by U.S. President Donald Trump.

Bitcoin dipped 1.2% on the day to just above $118,000 after experiencing record highs of $123,000 last week. Meanwhile, ETH dropped 2.9% in the past 24 hours to $3,607, following Monday’s rally above $3,700, its highest level since December, according to CoinGecko.

XRP recorded more prominent losses on the day, decreasing by more than 9% to $3.24. Solana (SOL) dropped by more than 6% to $189.

SOL’s drop comes one day after the coin broke above $200 for the first time since February. Shawn Young, Chief Analyst at MEXC said in a statement shared with The Defiant that SOL’s rally above $200 reflects a “broader validation of its evolving market narrative and appeal.”

Total cryptocurrency market capitalization is currently standing at $3.93 trillion, down 6% over the past 24 hours, according to CoinGecko. Trading volume over the same time frame amounted to $220 billion.

In the past 24 hours, over $561 million in crypto positions were liquidated, according to CoinGlass. Long positions made up the bulk at $442 million, while shorts totaled $119 million. Ethereum experienced the most liquidations at nearly $123 million, followed by altcoins at around $84 million. Bitcoin liquidations totalled around $55 million.

ETH ETFs Anniversary

In the exchange-traded fund (ETF) space, ETH ETFs attracted nearly $534 million in inflows on Tuesday, the third-largest single-day inflow on record. These latest inflows extend a 13-day streak of positive flows.

This comes just a week after ETH ETFs hit an all-time high with over $726 million in a single day. Notably, July 23 also marks the one-year anniversary of ETH ETFs launching in the U.S.

“It’s been a year since Ethereum ETFs got the green light, and institutional appetite is stronger than ever,” said Kean Gilbert, Institutional Relations Lead to Lido DAO, in comments shared with The Defiant. “Looking ahead, the next year should see ETFs evolve to fully capture staking rewards while maintaining the liquidity needed for daily redemptions – a challenge today, particularly in Europe where staking exposure is capped around 50%.”

Gilbert explained that with clearer U.S. regulatory guidance on ETF staking expected soon, liquid staking tokens like stETH could become key tools for institutions, helping them to access the “full potential of staking rewards while staying liquid.”

Meanwhile, U.S. spot Bitcoin ETFs recorded negative net flows for the second consecutive day, of nearly $68 million on Tuesday, according to SoSoValue.

Trump’s Trade Talks

Today’s market downturn is partly driven by uncertainty following President Trump’s recent trade announcements.

On Tuesday night, Trump announced on his social media platform, Truth Social, a major trade deal with Japan, involving a $550 billion investment.

“We just completed a massive Deal with Japan, perhaps the largest Deal ever made. Japan will invest, at my direction, $550 Billion Dollars into the United States, which will receive 90% of the Profits,” Trump claimed in his post. “This Deal will create Hundreds of Thousands of Jobs — There has never been anything like it. “

The president also added that Japan will “open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things” as well as pay reciprocal tariffs to the U.S. of 15%.

Earlier today, Trump said that he would only lower tariffs if a nation agreed to open its markets. “IF NOT, MUCH HIGHER TARIFFS! Japan’s Markets are now OPEN (for first time ever!). USA BUSINESSES WILL BOOM!” he wrote on Truth Social.

Trump also announced on Truth Social on Tuesday that the U.S. had reached a trade agreement with the Philippines that would allow for a 19% tariff on certain goods. The Philippines is among several nations that received notices from the White House about steep tariffs set to take effect on August 1.