Ethereum Plunges 6% to $1,870 as Trump Tariffs Spark Market Sell-Off

Ethereum's price experienced a significant decline, falling below the $1,890 mark on Friday, making it the second-largest loser among the top 10 ranked assets, trailing only XRP. This downturn followed a week of notable gains, with Ethereum testing the $2,100 level on Wednesday. The initial rally was driven by bullish catalysts, including the announcement by Trump-backed WLFI to launch a stablecoin on Ethereum and BNB Chain, as well as the successful deployment of the Pectra upgrade.

The market dynamics shifted dramatically following President Donald Trump’s announcement of new tariffs, which sparked widespread losses across financial markets. Ethereum was among the hardest hit, with its price plunging 6% to trade as low as $1,870 on Friday. As of the latest reports, ETH price had recovered slightly to $1,895. The accompanying rise in trading volumes suggests that Ethereum could face additional selling pressure in the coming sessions.

Ethereum’s spot market performance positioned it as the hardest-hit asset, leading total liquidations in the past 24 hours. Data from the derivatives markets indicates that many over-leveraged bullish traders were caught off guard. Total crypto liquidations reached $449.89 million, with Ethereum alone accounting for $136.21 million—the highest among all cryptocurrencies. This underscores the heightened volatility and risk associated with leveraged trading in the current market environment.

Other major cryptocurrencies also experienced significant losses. Bitcoin (BTC) saw $116.56 million in liquidations, XRP recorded $24.86 million, and Solana (SOL) faced $17.28 million in liquidations. These synchronized declines among top-ranked layer-1 altcoins highlights the broader market’s sensitivity to external macroeconomic pressures. If the prevailing weak market sentiment persists, Ethereum could face further downside risks in the near term.

Ethereum's price drop below $1,900 was primarily due to broader market sell-offs triggered by new U.S. tariffs, leading to increased liquidations and bearish sentiment. The factors influencing Ethereum’s volatility this week included Trump-backed WLFI’s stablecoin announcement, the Pectra upgrade, and macroeconomic concerns like new U.S. tariffs. The heightened volatility and risk associated with leveraged trading in the current market environment have positioned Ethereum as the hardest-hit asset, leading total liquidations in the past 24 hours. The synchronized declines among top-ranked layer-1 altcoins highlights the broader market’s sensitivity to external macroeconomic pressures. If the prevailing weak market sentiment persists, Ethereum could face further downside risks in the near term.