The cryptocurrency market suffered a sharp downturn over the past 24 hours, triggering $1 billion in liquidations, as bitcoin and other digital assets tumbled alongside a steep decline in U.S. equities.

According to Coinglass data, 303,466 traders were liquidated, with total crypto liquidations reaching $1 billion. The overwhelming majority—$869 million—came from long positions, while short liquidations accounted for just $135 million, underscoring the severity of the sell-off.

Bitcoin briefly plunged to a low of $82,467.23 before increasing in value to now sit slightly above $83,000, while Ethereum dropped below $2,100 for the first time in 15 months, recording a 12.7% decline over the past day, according to The Block's Prices Page.

The sharp decline in cryptocurrency markets over the past 24 hours mirrored a dramatic reversal in U.S. equities. The Dow Jones, which opened Monday’s session up 300 points, plunged as much as 1,100 points by the afternoon. Meanwhile, the S&P 500 wiped out $1.5 trillion in market cap, amplifying the broader risk-off sentiment across global financial markets. As of early Tuesday, all major U.S. stock indices were trading lower in pre-market hours.

The shift toward risk aversion comes as the Trump administration's new tariffs on Canada, Mexico, and other regions are set to take effect this week. These measures are expected to push the average U.S. tariff rate to levels unseen since the Great Depression. Since the 1930 Smoot-Hawley Tariff Act, which many economists see as contributing to a collapse in global trade, U.S. policy has largely moved toward reducing trade barriers through multilateral agreements—until now.

"I voted for Trump but I never thought he’d be so foolish to actually move forward with 25% tariffs given the well-documented history of how the Smoot-Hawley Tariff Act of 1930 triggered the onset of the Great Depression as global trade flows dried up," The Future Fund LLC Managing Partner Gary Black posted on X.com.

In the derivatives market, options traders are preparing for increased volatility as bitcoin approaches key support levels. Cryptocurrency derivatives trader Gordon Grant noted that the March 28 bitcoin options expiry now reflects an implied volatility of 60% across all strike prices, signaling heightened expectations of bigger price swings.

Grant also pointed to a notable risk inversion between March and April contracts, with March volatility trading 3 points higher than April. This suggests that short-term uncertainty is rising faster than longer-term concerns.

Additionally, Grant told The Block that bitcoin's at-the-money (ATM) options have surged to a 75% implied volatility, which signals extreme uncertainty in price direction.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

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