April 7, 2025, marked one of the most dramatic days in crypto market history. Within hours, major digital assets plunged sharply, echoing the infamous crash of March 2020. This time, the panic was triggered by real-world political developments: U.S. President Donald Trump signed a sweeping executive order imposing new import tariffs, prompting investors to flee risk assets.


 

What Happened?

On April 2, President Trump announced the introduction of import tariffs on products from over 150 countries. He dubbed the day “Liberation Day” and described the move as a "declaration of U.S. economic independence." The sweeping tariffs included 34% on Chinese imports, 20% on goods from the European Union, and 46% on imports from Vietnam. The highest tariffs were imposed on Cambodia (49%), Laos (48%), and Madagascar (47%).

Markets reacted swiftly. Heightened geopolitical and economic tensions caused a correction across global stock exchanges and a dip in oil prices. In this volatile environment, investors began rapidly offloading crypto assets.

How Did Cryptocurrencies React?

Trump’s tariffs set off a chain reaction of fear — many remembered the trade war of 2018–2019 and braced for a potential global slowdown. The crypto market, already sensitive to macroeconomic shifts, took a direct hit. In just 24 hours, the total crypto market capitalization dropped by 12%, falling to $2.47 trillion.

Here’s how the top five cryptocurrencies performed:

• Solana (SOL)

Down 24%. High DeFi activity and transaction delays left Solana vulnerable to volatility.

• Ethereum (ETH)

Fell 18%, hitting its lowest level since March 2023. Network congestion led to rising gas fees and slower transactions.

• Bitcoin (BTC)

Dropped 16%, breaking below $55,000 — its lowest point since November 2024. Liquidations on futures markets exceeded $1 billion.

• Avalanche (AVAX)

Lost 22%. Structural concerns and regulatory uncertainty triggered a wave of sell-offs.

• Chainlink (LINK)

Fell 19%, mainly due to oracle infrastructure issues disrupting DeFi protocol operations.

Why Did Trump’s Tariffs Have Such an Impact?

The crypto market is increasingly integrated into the global financial system, and any shifts in U.S. economic policy ripple across the ecosystem. New tariffs threaten to slow global trade, increase consumer prices, and weaken demand — especially in the U.S., where a large portion of crypto capital is concentrated.
 

In addition, a significant share of crypto mining equipment and infrastructure is produced in China and Southeast Asia. The tariffs raise concerns over higher logistics costs and potential supply disruptions, which could impact the industry long term.
 

What’s Next?

Many investors are now shifting to stablecoins or cashing out entirely. Analysts warn that if current volatility persists, a new crypto winter could be on the horizon.
 

Still, the crypto market has survived major crashes before — and rebounded. Much now depends on the Federal Reserve’s response, China’s stance, and possible easing measures from the SEC. For now, April 7, 2025, stands as a stark reminder of how deeply digital assets are tied not only to technology — but also to global politics.