Bitcoin Rebounds to $90K on Tariff Pause; Crypto Liquidations Top $1 Billion

Markets digested a rare policy de-escalation on Wednesday: a pause on new U.S. tariffs aimed at Europe. The headline sparked a swift risk-on turn, sending Bitcoin back above $90,000 before settling near $89,574, while U.S. equities climbed roughly 1.5% across the S&P 500, Nasdaq, and Dow. Ethereum pushed back above $3,000 and XRP advanced more than 3% to $1.96. Under the surface, though, derivatives felt the sting—over $1 billion in crypto positions were liquidated in 24 hours.

The catalyst came from Davos. After meeting NATO Secretary General Mark Rutte, President Trump said he would not proceed with tariffs slated for February 1. He described a framework for a potential arrangement involving Greenland and the broader Arctic region, and, based on that understanding, signaled a halt to the tariff plan. Markets that sagged on Tuesday reversed quickly.

The key story here isn’t the pop; it’s the path. Bitcoin slid toward $87,000 earlier, then ripped back above $90,000. That kind of two-way tape punishes leverage. CoinGlass data show more than $1 billion in liquidations over the past day: $672 million from longs and $335 million from shorts. Bitcoin accounted for about $426 million of those losses, with Ethereum around $366 million. When both sides get cleaned out in the same session, you’re looking at a tight order book, aggressive basis swings, and funding flips that force traders to chase, then capitulate.

This is the feedback loop that defines crypto in headline-heavy weeks. Policy signals shift expected dollar and rate trajectories, and crypto reacts first through derivatives, not spot. The round-number magnet at $90,000 amplified behavior: breakout buyers piled in, stops clustered below, and each micro-move fed the liquidation engine. You end up with a tape that looks directional but trades like a grinder—great for disciplined scalpers, expensive for conviction leverage.

There’s also a narrative market running alongside price. On Myriad, a prediction platform operated by Dastan, traders now assign a 56% chance that President Trump will formally offer to acquire Greenland before July, up nearly 14 percentage points in a day. Whether that materializes or not is secondary; rising odds add optionality to geopolitical risk and keep macro-sensitive assets jumpy.

For practitioners, the tell was cross-asset confirmation. Equities and crypto rose in tandem on the tariff pause, a classic relief pattern. Yet the liquidation split—longs absorbing the larger hit despite a green day—signals how choppy the intraday structure was. It suggests many participants were positioned for continuation after earlier weakness, got stopped on the dip to ~$87,000, and then watched the rebound leave them flat-footed. That behavioral cycle—late entries, tight risk, forced exits—remains the dominant driver when macro headlines arrive mid-session.

Until policy messaging stabilizes, expect the headline-to-liquidation pipeline to remain active. Spot direction will keep taking its cues from geopolitics, but PnL will be decided in the perps: open interest density around round numbers, forced buying and selling via the liquidation ladder, and the willingness of traders to fade or follow each spike. Wednesday showed, again, how quickly crypto reprices when the tariff pendulum swings—and how costly the repricing can be when leverage is the first responder.