Tariff Shock Reveals a Two-Tier Crypto Market: BTC vs Everyone Else?

• Tariff shock exposes deep crypto liquidity issues beyond simple price drops
• ETH/Altcoins hit hardest; ETH sees net capital outflows, 5-year low vs BTC
• Bitcoin shows relative strength despite pressure; inflow drop smaller than ETH

Trump’s “Liberation Day” tariff announcement sent shocks through global markets, shifting risk sentiment. Glassnode data shows equities dropped sharply, oil prices eased, and digital assets also fell. The policy move towards a weaker dollar and tighter fiscal spending hurt investor confidence, pushing capital away from crypto assets.

Crypto markets reacted with significant declines; Bitcoin and Ethereum posted double-digit losses. More importantly, underlying liquidity worsened, increasing volatility and making investors uneasy. All of this shows how macro events strongly affect crypto market structure and feeling.

Why is Crypto Market Liquidity Drying Up Post-Tariffs?

Since the beginning of 2025, capital flowing into Bitcoin and Ethereum has fallen sharply. Bitcoin’s monthly realized cap inflows have dropped from $100 billion to just $6 billion. Ethereum fared worse, sliding from $15.5 billion in inflows to $6 billion …

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