Global markets were jolted after President Donald Trump announced plans to impose new tariffs on eight European countries, linking the measures to renewed pressure over Greenland. The comments, posted on his Truth Social account, rippled quickly through financial markets and triggered heavy selling in cryptos, equities, and risk-sensitive assets.
Roughly $875 million worth of crypto positions were closed. Bitcoin fell 3%, dropping to $92,000, as traders rushed to cut exposure amid rising geopolitical uncertainty. The sell-off was magnified by thin trading conditions during a U.S. holiday period, which tends to exaggerate price swings.
About $788 million of the liquidations were long positions, compared with roughly $83 million tied to short positions. The imbalance suggests many investors were caught off guard after expecting recent price momentum to continue. The largest concentration of forced closures occurred on Hyperliquid, which accounted for $262 million, followed by Bybit with $239 million and Binance with $172 million.
Trump stated that the affected countries, Norway, Denmark, Sweden, Germany, France, the United Kingdom, Finland, and the Netherlands, would face import duties of 10% beginning February 1. The rate would rise to 25% by June 1 unless a deal is reached for what he described as the complete purchase of Greenland.
The proposal sparked an immediate and unified backlash across Europe. French President Emmanuel Macron called for the use of the European Union’s trade bazooka, a legal tool designed to counter economic pressure by restricting access to EU markets and services. Other leaders echoed the criticism. The British prime minister said targeting allies with tariffs was entirely misguided, while Sweden’s prime minister stated that his country would not accept coercion.
Spain’s prime minister warned that any U.S. move against Greenland would undermine NATO and serve Russian interests, while EU foreign policy chief Kaja Kallas said rivals such as Russia and China stood to benefit from divisions among Western partners.
The European Parliament responded by pausing approval of a recently negotiated U.S.-EU trade agreement. That deal had reduced duties on many American exports while allowing higher tariffs on certain European goods, and it had already faced criticism for favoring Washington.
The bloc is also prepared to revive $109 billion in retaliatory tariffs shelved during last year’s truce, while France is pushing to activate broader countermeasures that could limit U.S. investment protections and service access.
Beyond crypto, traditional markets also reacted. Futures tied to the S&P 500 slipped 0.7%, while Nasdaq futures fell close to 1%. European equity futures dropped roughly 1.1%. Investors sought safety elsewhere, sending gold up 1.5% to fresh record levels, while the U.S. dollar weakened slightly against the Japanese yen.
Some strategists urged caution, noting that the threat came via social media rather than formal policy. Brian Jacobsen of Annex Wealth Management noted that the delayed implementation could lead investors to pause before making drastic moves, allowing volatility to cool once the news is fully absorbed.
Deutsche Bank warned that financial retaliation, rather than tariffs alone, could prove far more disruptive. European investors hold trillions of dollars in U.S. assets that could be reallocated if tensions escalate. Goldman Sachs estimated that a 10 percent tariff could cut European corporate earnings growth by up to three percentage points, while ING projected a modest hit to regional economic output this year.
Analysts will be closely watching trading activity on exchanges like Coinbase Global Inc. (NASDAQ: COIN) over the coming days and weeks to see whether sentiment shifts and cryptos regain their upward momentum.
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