Last Monday (January 19), a clear risk-off sentiment swept through global financial markets, with cryptocurrencies bearing the brunt. The trigger was the new US administration announcing the initiation of new tariffs on several European countries, which immediately triggered market risk aversion instincts, putting risk assets under pressure.

Bitcoin appeared somewhat weak right from the Asian morning session. The rebound momentum driven by the derivatives market last week was waning, and BTC subsequently retraced about 3%, falling to around $92,415. Although this may seem like a small decline, it triggered a chain reaction in the market—over $680 million in total liquidations occurred in the past 24 hours. About $600 million of this came from long positions, indicating that many traders had leveraged up during last week’s rally, betting on continued gains, only to be caught off guard.

Altcoins performed even worse. SOL dropped 6.7%, and SUI even fell over 10% at one point, reflecting the true temperature of market sentiment—when investors panic, they often cut first and foremost high-leverage and high-risk assets.

Interestingly, despite the short-term correction, some market observers believe that the selling pressure since early 2025 is gradually easing. Rachael Lucas, an analyst at BTC Markets, mentioned that if the current support levels do not hold, $90,000 could become the next price point traders focus on. However, optimists point out that the potential demand from institutional funds might provide support at the bottom.

All of this points to the same question: How fragile is the market structure? According to liquidation data, about 90% of positions are long positions being forcibly liquidated, revealing that the market has accumulated quite a few crowded long positions after the rebound, and any negative catalyst could easily trigger a cascade of liquidations. The escalation of trade tensions is just that catalyst.