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The cryptocurrency market is down on March 27, with the total market capitalization dropping by 0.91% to about $2.77 trillion. At its week-to-date high, the market cap was at around $2.86 trillion.<\/p>\n TOTAL crypto market capitalization daily performance chart. Source: TradingVew<\/em><\/p>\n<\/figcaption><\/figure>\n\n Several factors have contributed to the latest drop in crypto prices, including:<\/p>\n The latest trade war escalation and its impact on broader risk sentiment.<\/p>\n<\/li>\n Liquidations of overleveraged futures positions.<\/p>\n<\/li>\n A prevailing bearish technical setup.<\/p>\n<\/li>\n<\/ul>\n Rising global trade tensions are at the heart of the current cryptocurrency market decline.<\/p>\n What to know:<\/p>\n On March 25, the US government announced that it would impose 25% tariffs on auto imports and other goods from Canada, Mexico, and China beginning April 3.<\/p>\n<\/li>\n These protectionist measures have reignited concerns of a global economic slowdown, weighing on market sentiment across asset classes.<\/p>\n<\/li>\n The S&P 500, for instance, has declined by nearly 1.85% since the announcement.<\/p>\n<\/li>\n<\/ul>\n S&P 500 daily performance chart. Source: TradingView<\/em><\/p>\n<\/figcaption><\/figure>\n Fears of renewed inflation are intensifying, as the tariffs are expected to raise consumer prices on key goods, according to St. Louis Fed President Alberto Musalem<\/a>.<\/p>\n<\/li>\n Higher rates are leading to lowering rate cut bets in the futures market, with odds of a 25 basis point rate decrease now down to 58% compared to 62.50% a week ago.<\/p>\n<\/li>\n<\/ul>\n Target rate potential for June 18, 2025 Fed meeting. Source: <\/em>CME<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n As a result, top cryptocurrencies like Bitcoin (BTC<\/a>) and Ether (ETH<\/a>), which typically trade in tandem with risk markets, are seeing heightened selling pressure.<\/p>\n<\/li>\n<\/ul>\n Almost all top cryptocurrencies have suffered larger long liquidations versus shorts in their respective markets, thus amplifying the sell-off.<\/p>\n Key points:<\/p>\n Bitcoin, which makes up over 61% of the total crypto market cap, has witnessed $62.45 million in net liquidations in the last 24 hours, out of which $48.94 million were long positions.<\/p>\n<\/li>\n<\/ul>\n Crypto market liquidation heat map (24-hour). Source: <\/em>Coinglass<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Similarly, Ether, the second-largest cryptocurrency by market cap, suffered over $43 million in long liquidations of a total of $51.76 million in the same period.<\/p>\n<\/li>\n Overall, the total crypto market liquidations come in at $257.35 million in the last 24 hours, of which $198.11 million are longs.<\/p>\n<\/li>\n<\/ul>\n Why this amplifies the sell-off:<\/p>\n In recent weeks, most traders entered long positions<\/a> on Bitcoin, Ether, and other top cryptocurrencies, anticipating a continuation of the uptrend amid improving macro signals like Fed dovishness<\/a> or ETF inflows<\/a> earlier this year.<\/p>\n<\/li>\n The surprise tariff announcement and renewed inflation concerns caught the market off-guard, triggering a sharp reversal in sentiment.<\/p>\n<\/li>\n<\/ul>\n\n
Trump tariffs return to hurt crypto sentiment<\/h2>\n
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Long liquidations overpower shorts<\/h2>\n
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