The crypto market faced high volatility last week. After the FED’s interest rate announcement, Bitcoin first hit 100.000 € before plunging below 90.000 € due to Trump’s new tariffs on China, Canada, and Mexico. These tariffs triggered a major sell-off, wiping out $2.2 billion in liquidations and causing one of the biggest single-day crashes in crypto history. Analysts warn that this sharp correction could be a bear trap.
Meanwhile, Ripple secured key U.S. licenses, and Sam Bankman-Fried’s parents have formally requested a presidential pardon from Trump. Let’s break it all down in this weekly crypto news update.
Bitcoin Hits 100.000 € Again, Then Crashes below 90.000 €—Will It Rebound?

Bitcoin (BTC) has been on a wild ride, reacting to FED decisions, Trump’s tariffs, and shifting investor sentiment.
At the beginning of last week, the U.S. Federal Reserve (FED) announced that it would keep interest rates unchanged at 4.25–4.5%, as expected by the market. At first, Bitcoin dipped, but it quickly bounced back after Fed Chair Jerome Powell reassured investors that monetary policy would remain flexible.
Over the next two days, Bitcoin’s price increased by approximately 3.5%, reaching around 100,000 € on January 31.
Then, on February 2, Trump’s tariffs sent Bitcoin tumbling below 90.000 €. Bitcoin’s rally came to a halt when Trump imposed new tariffs on China, Canada, and Mexico. The move triggered economic uncertainty, causing BTC to drop below 90.000 €. You can read more about this below.Despite this drop, it’s important to remember that BTC recently closed above 100,000 € for the first time ever, and many believe this correction is just a temporary setback. While retail investors are selling, big players like MicroStrategy and major investment funds are still buying Bitcoin, pushing Bitcoin ETF holdings to a record $39.57 billion. Analysts still predict BTC could hit 200.000 € by the end of 2025 if demand continues to grow.
Crypto Market Dropped: Trump’s tariffs caused a $2.2B sell-off

The crypto market just took a major hit, wiping out over $2.2 billion in liquidations as Bitcoin fell below 90.000 € and Ethereum crashed 20% in just 24 hours. But what did this happen and what does this mean for you? Let’s break it down.
Why Crypto Market Dropped? What Happened?

Many traders were betting that Bitcoin and other cryptocurrencies would keep rising. But then, panic hit the market after U.S. President Donald Trump announced new tariffs on Canada, Mexico, and China.
President Donald Trump has imposed new tariffs—25% on Mexico and Canada, 10% on China, and 10% on Canadian energy to limit price spikes. He stated that these tariffs, aimed at addressing immigration and drug-related issues, could increase if these nations retaliate and that tariffs on the EU are not excluded.
With $1.6 trillion in annual trade at stake (excluding the EU), the move is expected to have major global economic effects, impacting supply chains, prices, and market stability. Higher tariffs can lead to inflation, which often results in higher interest rates—something that pushes investors away from riskier assets like crypto (explained here).
This uncertainty caused a massive sell-off, and a $2.2B crypto crash wiped out leveraged traders and caused Bitcoin to fall below 90.000 €. This led to one of the biggest single-day crashes in crypto history.
What Are Liquidations?

Some traders use leverage, which means they borrow money to trade larger amounts. If prices go in their favor, they win big—but if prices drop too much, their positions get automatically closed (liquidated), causing them to lose everything they invested.That’s exactly what happened here: $1.87 billion in bets on higher prices got wiped out. Ethereum fell to 2.280 €, losing 20%, while Bitcoin dropped below 90.000 € before bouncing back slightly. Smaller cryptocurrencies (altcoins) suffered even bigger losses, with many dropping 15% to 30% in a single day.
Is This a Bear Trap?

Despite the drop, some analysts warn that this could be a bear trap—a temporary dip before Bitcoin resumes its uptrend.
A bear trap occurs when coordinated selling creates a short-term price drop, misleading investors into thinking a deeper downturn is coming. It often happens during a long-term uptrend as a significant correction (see picture).
While some analysts see this as a temporary correction, others caution it could signal a larger downturn. Experts advise staying cautious, avoiding high-risk trades, and focusing on long-term strategies instead of chasing quick profits.
For newcomers to crypto, moments like these highlight the importance of understanding risk and the impact of events that could affect the macroeconomy.
Ripple (XRP) Secures New State Licenses

Ripple (XRP) has secured Money Transmitter Licenses in New York and Texas, allowing it to expand its payments business in the U.S. This means Ripple customers will now have licensed access to cross-border payment solutions within the country, with transactions managed end-to-end by Ripple.
Many see this as a positive step for Ripple, as it strengthens its position in the regulated U.S. financial system, enhancing adoption and partnerships—especially under the Trump administration’s pro-crypto stance.
Will Trump Pardon Bankman-Fried’s Parents?

Sam Bankman-Fried (known as SBF), founder of FTX, was convicted of fraud after his exchange collapsed in 2022, causing one of the biggest crashes in crypto history. FTX was the second-largest crypto exchange in the world, handling billions in user assets. Its sudden collapse left millions of investors without access to their funds and sent shockwaves through the crypto industry.
Now, his parents, Joseph Bankman and Barbara Fried, are seeking a presidential pardon from Donald Trump. A pardon would clear their disgraced crypto-billionaire son who is currently serving a 25-year prison sentence. This comes after Trump recently pardoned Ross Ulbricht, who was freed after 11 years in prison for running Silk Road, an illegal online marketplace on the dark web.
While Silk Road was controversial, Ulbricht played a key role in Bitcoin’s early adoption, as the platform was one of the first real-world use cases for cryptocurrency, demonstrating its potential as a decentralized payment system. However, pardoning SBF could be highly controversial, as many believe his family played a significant role in FTX’s downfall. Whether Trump will intervene remains to be seen.
Last week highlighted how global events, like Trump’s tariffs, can shake riskier assets like crypto. While retail investors panicked, big players kept buying, pushing Bitcoin ETF holdings to a record $39.57 billion. Some analysts warn of further volatility, but others see this as a bear trap designed to shake out smaller investors before a rebound.
As macroeconomic shifts continue to shape the market, staying informed is more important than ever. Stay updated with our weekly crypto news every Monday, and don’t forget to catch up on last week’s updates to stay informed.