Trump’s Greenland Tariff Threat Sparks $680M Crypto Liquidation; Bitcoin Breaches $93K
Bitcoin tumbles below $92,000 as President Trump demands Greenland purchase under threat of 25% tariffs on NATO allies, triggering a $680M leverage flush.
Geopolitics has returned to the driver’s seat. Bitcoin plunged below $92,000 early Monday after President Trump issued an ultimatum to eight NATO allies: sell Greenland to the United States or face immediate trade penalties. The announcement, posted to Truth Social over the weekend, triggered a risk-off cascade that wiped out over $680 million in leveraged long positions across the crypto market.
The Greenland Ultimatum
Effective February 1, the U.S. will impose a 10% tariff on all goods from Denmark, Finland, France, Germany, the Netherlands, Norway, Sweden, and the UK. The White House explicitly linked the levies to Arctic security, demanding the acquisition of Greenland to secure the “northern flank.” If no deal is reached by June 1, tariffs will escalate to 25%.
This is not a negotiation tactic; it is a geopolitical ransom. The targeted nations responded swiftly, with European leaders convening an emergency ambassador meeting to discuss activating the EU’s “Anti-Coercion Instrument,” a trade weapon dubbed the “bazooka” designed for exactly this scenario.
“Europe will not be blackmailed,” said Danish Prime Minister Mette Frederiksen, rejecting the land-for-trade offer as “absurd.”
Market Liquidation
The reaction was instant. While gold futures surged to record highs on safe-haven demand, crypto assets were treated as high-beta risk. Bitcoin failed to hold the $93,000 support, sliding as much as 3.6% to tap $91,800 during the Asian trading session. Data from CoinGlass confirms the leverage flush was severe, with $680 million in bullish bets liquidated in 24 hours.
The move mirrors the “Liberation Day” tariff shock of April 2025, where similar trade threats caused a $20 billion liquidation event. However, the structural risk is higher today. Institutional desks are pricing in a prolonged trade war, with the dollar showing unusual weakness against the Swiss Franc and Gold, suggesting confidence in U.S. institutional stability is fraying.
The Institutional Outlook
Traders are now hedging against a “dangerous downward spiral” in transatlantic relations. With the EU threatening retaliatory tariffs on U.S. tech and agriculture, the correlation between Bitcoin and traditional risk assets (like the Nasdaq) is tightening. The market has shifted from “buy the dip” to “protect the capital,” with liquidity drying up on major exchanges as market makers widen spreads in anticipation of further volatility.
