Markets convulsed after President Donald Trump threatened steep tariffs on eight European nations unless Denmark cedes Greenland, with rhetoric including hints the U.S. might seize the territory by force, triggering a global risk-off move on January 20.

Gold surged to record highs while Bitcoin plunged into the low-$90K range, with some intraday trades dipping as low as $87K.

The crypto market shed nearly $150 billion in market capitalization as leveraged positions unwound violently, exposing Bitcoin’s continued treatment as a speculative asset rather than the safe haven its proponents claim it to be.

Tariff Shock Drives Historic Divergence

Trump’s Saturday announcement targeted Germany, France, the UK, the Netherlands, Finland, Sweden, Norway, and Denmark with 10% tariffs starting February 1, escalating to 25% by June 1, unless a Greenland deal is reached.

ING economists warned that “additional tariffs of 25% would probably shave 0.2 percentage points off European GDP growth,” compounding recession fears already gripping the continent.

The tariff threat effectively reopened the trade war between the EU and the U.S., despite a temporary truce reached in late July, raising the stakes and bringing a far tougher approach.

European officials brought forward the option of activating the so-called anti-coercion instrument, the EU’s trade “bazooka“, allowing the bloc to impose tariffs and investment limits on offending nations.

French President Emmanuel Macron announced he would request the instrument’s activation, while Manfred Weber from the European Parliament’s largest party indicated the July deal was now “on ice.”

European countries hold approximately $8 trillion in U.S. bonds and stocks, making Europe by far the largest U.S. lender and exposing the deep interdependence that could turn this standoff into a full-blown crisis.

Germany’s export-reliant economy faces particularly acute pressure, with ING economist Carsten Brzeski warning the new tariffs would be “absolute poison” for the fragile recovery underway.

German exports to the United States fell 9.4% from January to November compared with a year earlier, and the trade surplus dropped to its lowest level since 2021.

Meanwhile, gold’s parabolic rally pushed prices past $4,800 per ounce to all-time highs.

TD Securities’ Daniel Ghali told Bloomberg that “gold’s rally is about trust. For now, trust has bent, but hasn’t broken. If it breaks, momentum will persist for longer.“

Crypto Markets Suffer Violent Unwind

Bitcoin’s collapse alongside traditional risk assets exposed the crypto’s failure to serve as a geopolitical hedge, despite years of positioning as “digital gold.”

CoinGlass liquidation data revealed $998.33 million in long positions wiped out over 24 hours, with Bitcoin accounting for $440.19 million as cascading margin calls accelerated during thin Asian trading hours.

Galaxy Digital’s Alex Thorn noted that “Bitcoin isn’t quite doing the thing that it’s built to do, at least in real time,” while Bitunix analyst Dean Chen observed that “among crypto-native investors, it is increasingly framed as a geopolitical hedge and a non-sovereign store of value.”

“However, for the broader market, Bitcoin is still largely traded as a high-beta risk asset,” he concluded.

Derivatives markets paint an increasingly bearish picture for the months ahead.

Sean Dawson of Derive.xyz warned that “rising geopolitical tensions between the US and Europe—particularly around Greenland—raise the risk of a regime shift back into a higher-volatility environment, a dynamic not currently reflected in spot prices.”

Options data shows strong put open interest concentrated across the $75K-$85K strikes for the June 26 expiry, with Dawson noting that “from an options perspective, the outlook remains mildly bearish through mid-year. Traders are paying a premium for downside protection.“

Bloomberg Intelligence strategist Mike McGlone delivered an even more dire assessment, warning that Bitcoin’s inability to hold long-term averages in 2025 suggests the price could eventually drop as low as $10,000.

Duke University’s Campbell Harvey also claimed in academic research that Bitcoin “is hardly a safe-haven asset,” noting its correlation with gold has broken down completely.

Institutional Demand Offers Potential Floor

Despite the bearish technical picture, not all analysts have turned pessimistic.

MEXC data showed that on January 16 alone, Bitcoin ETFs added 1,474 BTC, accounting for $1.48 billion in weekly inflows, while 36,800 BTC left exchanges.

These are signs of strong institutional demand and tightening supply that could limit downside.

In fact, as Cryptonews noted recently, the chance of Trump turning back on the tariff decision is high, with 86%, and that would greatly benefit Bitcoin after February 1.

Speaking with Cryptonews, Bitfinex analysts also noted that “Bitcoin spot volumes remain normal, funding rates are close to neutral, and there has been no spike in exchange inflows that would signal reactive selling,” suggesting the selloff reflects macro-linked noise rather than a crypto-specific catalyst.

For now, whether Bitcoin’s current consolidation represents capitulation or merely the calm before a deeper storm remains the central question facing crypto markets as February approaches.

The post Greenland Gambit Sparks Crypto Chaos: Tariff Threats Send Bitcoin Sliding – Analysts Eye $75K appeared first on Cryptonews.

The crypto market shed $150 billion in capitalization as Bitcoin plunged below $88,000 amid a brutal leverage unwind, while gold surged past $4,800 per ounce for the first time in history.

The sharp divergence came as President Donald Trump’s escalating tariff threats against European allies over Greenland triggered a broad flight from US risk assets, with geopolitical tensions reaching their highest point since the Liberation Day tariff announcements of April 2025.

Bitcoin tumbled 9% in 48 hours to $87,000, wiping out $360 million in leveraged long positions in a single hour late Monday.

The selloff intensified pressure on an already fragile market structure, with short-term holders (those who purchased Bitcoin within the past 155 days) now underwater for eight consecutive weeks, requiring a recovery above $98,000 to return to profitability, according to Glassnode data.

Market Sentiment Hits Multi-Year Lows

CoinGlass liquidation data revealed 181,570 traders were wiped out over 24 hours, with $998.33 million in long positions liquidated versus just $71.39 million in shorts.

Bitcoin accounted for $440.19 million in forced selling, while Ethereum accounted for $392.38 million in liquidations, as the cascade accelerated during thin Asian trading hours.

Rex from R89Capital captured the despair gripping crypto natives, stating, “sentiment has bottomed out for sure. No one gives a single fuck about crypto. Die hard crypto natives who’ve shown up daily for years are trading stock shitters and commodities.”

He added that “it literally can’t get any worse for sentiment than right now,” noting that even during the COVID crash bottom, people still believed in the industry.

Another analyst, TheGreekGod11, echoed this frustration, observing that the industry executed “an excellent job at making crypto look like absolute dogshit” by voting in the first pro-crypto president, only to crash the market.

Mike Novogratz also warned that “the gold price is telling us we are losing reserve currency status at an accelerating rate,” adding that “$BTC is disappointing as it is still being met with selling.”

He reiterated that Bitcoin “has to take out 100-103k to regain its upward trend,” though he believes it will happen in time.

Joe Consorti offered a contrarian take, stating, “Bitcoin plummeting on geopolitical escalation, rather than ripping with gold and silver, tells you how early we are. The largest informational asymmetry in markets is still alive and well.“

Gold Rally Signals Deeper Structural Shifts

Gold extended its historic rally to $4,874.21, marking a 2.3% gain and continuing a three-session surge that has now pushed the precious metal within reach of $4,900.

According to Economies, Tony Sycamore, market analyst at IG in Sydney, stated that investors’ shedding of dollar-denominated assets reflects “a loss of confidence in the US administration and rising strains in international alliances following Trump’s latest threats.“

Daniel Ghali, senior commodity strategist at TD Securities, also told Bloomberg that the surge is spurring “fear of market-led debasement in the rest of the world,” adding that “gold’s rally is about trust. For now, trust has bent, but hasn’t broken. If it breaks, momentum will persist for longer.”

Goldman Sachs co-head of commodities research Daan Struyven also declared, “Gold remains our highest conviction,” reiterating the bank’s base case scenario of gold rising to $4,900 per ounce, with risks to the upside.

In fact, Benjamin Cowen stated bluntly that “metals outperformed crypto in 2025 and will likely do so again in 2026,” warning that when metals eventually correct, “crypto will likely drop more.“

Institutional Positions Show Mounting Stress

Traditional equity markets suffered parallel damage, with the S&P 500 falling 2.06% and the Nasdaq Composite dropping 2.4% on Tuesday after markets reopened following Monday’s holiday.

Strategy’s Bitcoin holdings came under scrutiny, with analyst Maartunn noting that “40% of Strategy’s Bitcoin supply is currently sitting at a loss,” adding that “pressure’s building.”

Analyst CrediBULL Crypto offered cautious optimism, pointing out that “for the first time in 7 months, LTH (long term holders) have shifted from being net sellers to net buyers,” suggesting the reversal may be just around the corner.

However, analyst Ted Pillows warned that “$BTC must hold above the $89,000 level. Losing this zone will end the short-term uptrend.“

Geopolitical Tensions Drive Safe Haven Rotation

Trump reiterated Tuesday there would be “no retreat” from his goal of controlling Greenland, threatening 10% tariffs on eight European nations beginning February unless they withdraw objections to US annexation.

French President Emmanuel Macron directly rebuked Trump’s tactics at Davos, while the EU prepared emergency countermeasures, including retaliatory tariffs worth €93 billion on US imports.

For now, no known agreement has been reached, as fear remains heightened in the market.

Bitcoin’s collapse alongside traditional risk assets, rather than rallying with gold, exposed the asset’s continued treatment as a speculative asset rather than a proven safe haven during geopolitical crises.

The post Gold at Record High, Crypto Down $150B – What’s Going On? appeared first on Cryptonews.