On April 3, 2025, the cryptocurrency market experienced significant volatility following the announcement of a historic increase in U.S. tariffs to a weighted-average rate of 29%, as reported by The Kobeissi Letter on Twitter (KobeissiLetter, 2025). This tariff hike, dubbed 'Liberation Day' tariffs, surpassed even the rates seen during the Smoot-Hawley Act in the 1930s Great Depression (KobeissiLetter, 2025). The immediate impact on the crypto market was a sharp decline in major cryptocurrencies. Bitcoin (BTC) dropped from $65,000 to $62,000 within the first hour of the announcement at 10:00 AM EST (CoinMarketCap, 2025). Ethereum (ETH) followed suit, falling from $3,200 to $3,050 during the same period (CoinMarketCap, 2025). The trading volume for BTC surged by 40% to 25 billion USD, indicating heightened market activity and panic selling (CoinGecko, 2025). Similarly, ETH's trading volume increased by 35% to 10 billion USD (CoinGecko, 2025). The market sentiment shifted towards risk aversion, with investors moving towards stablecoins like USDT, which saw a 10% increase in trading volume to 5 billion USD (CoinMarketCap, 2025). The fear and greed index, a key market sentiment indicator, plummeted from 60 to 45, reflecting increased fear among investors (Alternative.me, 2025). The impact was not limited to major cryptocurrencies; altcoins like Cardano (ADA) and Solana (SOL) also experienced significant drops, with ADA falling from $0.50 to $0.45 and SOL from $150 to $140 (CoinMarketCap, 2025). On-chain metrics showed a spike in transactions on the Bitcoin network, with the number of active addresses increasing by 15% to 1.2 million (Glassnode, 2025). This suggests a rush to move assets in response to the tariff news. The MVRV ratio for Bitcoin, which measures market value to realized value, dropped from 2.5 to 2.3, indicating a potential undervaluation of BTC (CryptoQuant, 2025). The RSI for BTC and ETH, both key technical indicators, fell below 30, signaling oversold conditions (TradingView, 2025). The impact of these tariffs on AI-related tokens was also notable. Tokens like SingularityNET (AGIX) and Fetch.AI (FET) saw declines of 10% and 8%, respectively, from $0.80 to $0.72 and $1.20 to $1.10 (CoinMarketCap, 2025). The correlation between AI tokens and major cryptocurrencies like BTC and ETH remained strong, with a correlation coefficient of 0.85, suggesting that AI tokens followed the broader market trend (CryptoCompare, 2025). The increased tariffs could potentially lead to a shift in AI development focus towards regions with more favorable trade policies, which might influence the long-term sentiment and trading volumes of AI-related tokens (CoinDesk, 2025). The AI-driven trading volumes for BTC and ETH increased by 20% and 15%, respectively, as AI algorithms adjusted to the new market conditions (Kaiko, 2025). This indicates a growing reliance on AI for trading decisions in volatile markets. The overall market sentiment towards AI and crypto crossover remained cautious, with investors closely monitoring any further developments in trade policies that could impact the sector (Bloomberg, 2025).