On February 2, the cryptocurrency market experienced an unprecedented liquidation event, with over $2.2 billion wiped out in 24 hours, affecting more than 700,000 traders. This surpassed previous records set during the FTX collapse and the COVID-19 crash. The massive sell-off was triggered by President Donald Trump's announcement of new tariffs: 25% on imports from Mexico and Canada, and 10% on goods from China, effective February 4. These measures heightened fears of a global trade war and potential inflation, leading investors to retreat from riskier assets, including cryptocurrencies. 

Following the sharp decline, the market staged a notable recovery. Bitcoin (BTC) rebounded by approximately 7.14%, climbing back to around $101,000, while Ethereum (ETH) saw an even stronger resurgence, increasing by 12% to $2,809. Altcoins also participated in the recovery, with XRP soaring 23.34%. This rebound was partly attributed to a temporary delay in the implementation of the announced tariffs, providing a brief respite and easing trade war fears. However, despite the recovery, most assets remain down on the week, reflecting the lingering uncertainty in the market.

Bitcoin ETF flows saw volatility this week, with January 31 bringing in $318.6 million in net inflows, led by BlackRock’s IBIT at $363.8 million. However, February 3 reversed course with $234.4 million in outflows, driven by Fidelity (-$177.6 million) and Ark Invest (-$50.7 million). The trend briefly turned positive on February 4, as $340.7 million flowed back into ETFs, before cooling off with February 6 showing $140.2 million in outflows, mainly from Fidelity (-$103.2 million) and Grayscale (-$42.2 million).

Ethereum ETFs had a strong week, recording consistent inflows across all tracked days. January 31 saw $27.8 million, which surged to $83.6 million on February 3, thanks to Fidelity's FETH ($49.7 million). The biggest inflow came on February 4, when $307.8 million was added, led by ETHA at $276.2 million. February 6 continued the trend with $10.7 million in inflows, marking an uninterrupted streak of capital entering ETH-based funds.

In the aftermath of the market turbulence, Dogecoin (DOGE) was among the hardest hit, declining by 25.8% over the past week. Conversely, Loan Protocol (LOAN) managed a slight gain of 0.5%, while XPR Network (XPR) contained its losses relative to the broader market downturn. Litecoin (LTC) and Solana (SOL) also faced declines, underscoring the week's overall bearish sentiment.