Crypto market slides as EU tariff shock and regulation jitters hit BTC, LINK, SUI, HBAR
Cryptocurrencies came under heavy pressure on January 19, with both Bitcoin and major altcoins retreating as traders reacted to fresh EU tariff headlines and a new wave of regulatory uncertainty.
The total value of the digital asset market dropped about 3%, pulling overall crypto capitalization down to roughly $3.2 trillion. Bitcoin, which only recently pushed beyond the $95,000 mark, slipped back to around $92,548 at the time of writing, a 2.7% decline in 24 hours.
Altcoins fared even worse. Chainlink (LINK) retreated 7% to about $12.74, Sui (SUI) plunged 12% to $1.56, and Hedera Hashgraph (HBAR) slid 7% to roughly $0.109. The sharper falls in these assets underline a familiar pattern: when macro risk flares, traders tend to exit higher-beta tokens first and fastest.
Sentiment turns sour as fear creeps back in
Market psychology has clearly shifted. The Crypto Fear & Greed Index fell by five points to 44, slipping out of neutral territory and edging closer to “fear.” That deterioration in sentiment reflects growing concern that external shocks—rather than on-chain fundamentals—are currently steering prices.
Derivatives data reinforced the picture of stress. According to figures from CoinGlass, total crypto liquidations skyrocketed by 726% to approximately $870 million in a short window, signaling a rapid flush-out of leveraged positions. Open interest dipped mildly to around $137 billion, hinting that some traders are stepping back and reducing exposure rather than rushing in to “buy the dip.”
Momentum indicators tell a similar story. The average relative strength index (RSI) across leading cryptocurrencies has dropped to about 35, squarely in a “weak” zone typically associated with oversold or fragile conditions. While such readings can sometimes precede a technical rebound, they also highlight that bullish conviction has thinned out.
Tariff shock triggers risk-off move
Unlike many previous sell-offs driven by crypto-specific scandals or protocol news, this downturn has more to do with geopolitics and global macro risks. Markets reacted swiftly to President Trump’s announcement of new 10% tariffs on several European countries, with a warning that duties could climb to 25% if negotiations break down.
The threat of a more aggressive US‑EU trade conflict sent a shock wave through risk assets worldwide. Investors rotated capital into traditional safe havens like gold, while both equities and digital currencies experienced brisk selling. More than $500 million in crypto long positions were liquidated in a compressed time frame, setting off a chain reaction of forced unwinds and margin calls as overextended traders were pushed out of the market.
Tariff headlines hit crypto particularly hard because digital assets are now deeply intertwined with macro trading narratives. Bitcoin is increasingly treated as a high-beta macro asset rather than an isolated niche market, so any sign of economic disruption or risk aversion can lead to outsized volatility.
Regulatory clouds add to the uncertainty
Macro jitters collided with fresh policy concerns in the United States. Reports that Coinbase had pulled its support for the CLARITY Act—citing unease about how regulators might treat stablecoin yields and decentralized finance products—dealt a blow to hopes for near-term regulatory progress.
The stalling of the CLARITY Act in the US Senate has injected another dose of caution among institutional investors, many of whom have been waiting for clearer frameworks around stablecoins, DeFi, and yield-bearing products. With those rules still in limbo, larger players are less inclined to add risk, especially after the strong rally that pushed Bitcoin above $95,000.
Profit-taking was already underway before the latest headlines, and the policy setback provided a convenient catalyst to accelerate that process. Thin weekend liquidity amplified the move, allowing relatively modest selling flows to trigger outsized price swings.
BTC technical picture: support holds, but downside risk lingers
From a technical standpoint, Bitcoin’s near-term outlook remains balanced, but with a slight tilt to the downside. Initial support has emerged in the $90,600–$92,000 band, where dip-buyers appear to be testing the waters. If that zone holds, it could form the base for a short-term consolidation phase.
However, a more pronounced pullback toward $88,000–$90,000 cannot be dismissed if selling resumes with force or fresh macro shocks appear. A break below that lower region would likely embolden bears and could trigger another wave of liquidations from overleveraged traders.
On the upside, resistance is clustered between $93,800 and $95,000, the region that recently capped Bitcoin’s attempt to extend its rally. Beyond that, additional hurdles stand near $97,000–$98,000. Only a decisive move through those levels, backed by strong volume and renewed momentum, would reopen a credible pathway toward the psychologically important $100,000 threshold.
For the coming days, many analysts anticipate a sideways, range-bound structure between roughly $91,000 and $94,000 as the market digests recent volatility and awaits new catalysts.
Speculative heat cools, but long-term optimism survives
Signs of cooling speculation are also visible in prediction markets. Odds on Polymarket that Bitcoin would hit $100,000 in January have fallen to around 25%, pointing to a notable reduction in aggressive short-term bullish bets.
Yet the longer-term narrative remains relatively constructive. CoinCodex models still point to a potential rise toward roughly $103,000 by mid‑February, contingent on macro conditions stabilizing and risk appetite recovering. Grayscale’s research takes an even broader view, forecasting that the first half of 2026 could bring renewed upside pressure as factors like regulatory clarity, institutional adoption, and sustained exchange-traded fund inflows support higher valuations.
Taken together, the data suggest that while immediate euphoria has faded, the structural bull case for Bitcoin has not been fundamentally broken. Instead, the market appears to be in a cooling phase following an intense rally, with macro headlines temporarily in the driver’s seat.
Why altcoins are underperforming Bitcoin
The weaker performance of LINK, SUI, HBAR and other altcoins is not coincidental. In stressed environments, traders typically rotate out of smaller-cap tokens with less liquidity and back into Bitcoin or stablecoins. That process often leads to an exaggerated downside in altcoins, even when their underlying projects have not experienced any negative news.
Chainlink, which plays a crucial role as an oracle network for DeFi applications, remains highly sensitive to broader risk sentiment because many of its largest holders are active traders and funds. Sui, a newer Layer‑1 blockchain, tends to see more speculative flows, so it reacts sharply when leverage is unwound. Hedera Hashgraph, despite enterprise partnerships, is still viewed by many as a higher-risk bet compared to Bitcoin.
For longer-term investors, such episodes can create opportunities to accumulate quality altcoins at discounted prices. However, the same volatility that makes them attractive can also compound risk, especially when macro conditions remain unstable.
How EU–US trade tensions spill into digital assets
At first glance, tariffs on European countries may seem distant from blockchain networks and decentralized protocols. In practice, they feed into the same macro equation that large funds use when allocating capital across equities, bonds, commodities and crypto.
Higher tariffs can dampen global growth expectations, increase uncertainty around corporate earnings and trade flows, and push investors toward assets perceived as safer or more predictable. Crypto, particularly in its current phase of adoption, is still seen as a high-risk segment. When trade war rhetoric escalates, digital assets tend to be part of the first wave of things investors cut.
Additionally, many institutional desks now trade Bitcoin and major altcoins alongside technology stocks and other growth assets. As soon as macro models flag a shift toward “risk-off” conditions, systematic selling can be triggered simultaneously in multiple markets, amplifying moves in crypto even if nothing has changed on-chain.
What traders should watch in the short term
Over the next several sessions, a few key signals could help gauge whether the market is stabilizing or preparing for another leg down:
– Bitcoin’s hold of the $90,600–$92,000 support zone. A sustained defense here would encourage range trading; a clean breakdown increases the risk of a drop toward $88,000–$90,000.
– Liquidation volume and leverage levels. A continued decline in open interest and reduced liquidation spikes would indicate that excess leverage is being flushed out, laying groundwork for a healthier rebound.
– Macro headlines on tariffs and trade negotiations. Any signs of de-escalation between the US and EU could ease risk aversion and support a recovery in high-beta assets, including crypto.
– Regulatory signals from US lawmakers and agencies. Progress on legislation like the CLARITY Act, or even clear guidance on stablecoin and DeFi treatment, could quickly restore institutional confidence.
Short-term traders may focus on range strategies, buying near support and trimming near resistance, while keeping stops tight due to headline risk. Longer-term participants often use such pullbacks to rebalance portfolios, adding incrementally to core positions rather than trying to time exact bottoms.
The role of sentiment and positioning
The drop in the Fear & Greed Index to 44 reflects a market that has lost its enthusiasm but has not yet descended into outright panic. Historically, the most attractive long-term entry points have tended to appear when sentiment is closer to extreme fear, accompanied by capitulation in volumes and a sharp contraction in leverage.
Current conditions show discomfort rather than full-scale capitulation. That suggests there may still be room for additional volatility if macro tensions flare again or if a large player decides to de-risk. At the same time, it also means there is still capital on the sidelines that could step back in quickly if prices stabilize and a clearer narrative emerges.
Medium-term perspective: consolidation before the next move
Zooming out beyond the next week or two, the market may be entering a classic consolidation phase after a strong cyclical upswing. Bitcoin’s approach to the $95,000–$100,000 zone naturally attracted profit-taking, and macro shocks provided the perfect excuse to lock in gains.
Consolidation periods can be frustrating, but they often serve as the foundation for the next sustained move. During such phases, weak hands are flushed out, leverage compresses, and spot accumulation from long-term holders quietly resumes. If macro conditions do not deteriorate dramatically, this type of pause can ultimately strengthen the quality of the uptrend.
Against that backdrop, forecasts such as CoinCodex’s projection of a potential move toward $103,000 in the medium term, and Grayscale’s expectation of renewed bullish forces in 2026, are less about exact price targets and more about the structural direction of travel: rising institutional comfort, clearer regulation, and deeper integration of crypto into traditional finance.
Bottom line
The January 19 pullback in BTC, LINK, SUI, HBAR and the broader crypto market is best understood as a collision of three forces: tariff-driven macro risk, a wobble in regulatory momentum, and a natural cooling after a powerful rally. Short-term volatility and a slight bearish tilt dominate the picture, but the broader, multi‑year thesis for Bitcoin and select altcoins remains intact.
In the near term, traders will be watching whether Bitcoin can hold key support around the low‑$90,000s, how far altcoin losses extend, and whether policymakers and negotiators can calm nerves on both the regulatory and geopolitical fronts. Until then, a choppy, range‑bound environment with an elevated sensitivity to headlines is likely to define crypto price action.