Bitcoin Slips On Trade War Fears, Sparks $865M in Liquidations

Bitcoin fell below $92,000 on January 19, 2026, as trade war fears intensified after U.S. President Donald Trump announced plans to impose tariffs on eight European nations. The move, aimed at pressuring Denmark to sell Greenland, triggered a sell-off across risk assets and pushed haven assets like gold to record levels.

The proposed tariffs, initially set at 10% in February and rising to 25% by June, targeted European countries including Germany, France, the UK, and others. Trump stated the tariffs would remain in place until a deal is reached for the full purchase of Greenland.

European leaders have responded with unified condemnation, with several calling the threats unacceptable and a threat to transatlantic alliances. The European Union is considering retaliatory measures, including potential tariffs worth up to $108 billion against U.S. imports.

Why the Move Happened

President Trump's tariff threats stem from his renewed push to acquire Greenland, a Danish territory. The move is part of a broader geopolitical strategy to strengthen U.S. Arctic influence.

Denmark, a NATO member and long-standing U.S. ally, has shown no indication of ceding Greenland, which is an autonomous territory. European Commission President Ursula von der Leyen and other EU leaders have emphasized the importance of maintaining sovereignty and independence for nations like Greenland.

How Markets Responded

Bitcoin's decline mirrored broader market sentiment, with the digital asset falling as much as 3.6% in the wake of Trump's announcement. Other tokens, including Ethereum and Solana, also experienced significant declines.

The market downturn triggered substantial liquidations, with over $864 million in leveraged positions being unwound in a 24-hour period. Long positions accounted for the majority of the losses, totaling $782 million.

Bitcoin futures open interest dropped as traders deleveraged and moved capital out of high-risk assets. The total crypto market capitalization fell nearly 3% to around $3.2 trillion.

What Analysts Are Watching

Analysts are closely monitoring how the situation unfolds, particularly whether the EU will follow through on retaliatory measures. The potential for a full-scale trade war between the U.S. and EU has raised concerns about long-term economic consequences and market instability.

Bitcoin's price remains in a tight range between $94,000 and $97,000, but the uncertainty has suppressed buying pressure. Some analysts predict that a break below $80,000 could trigger a deeper correction, while a hold above $95,000 may confirm Bitcoin's resilience.

The situation also highlights the broader geopolitical tensions impacting global markets. As European leaders prepare to meet with Trump at the World Economic Forum in Davos, the outcome of those discussions could have significant implications for trade and financial stability.