It's been a wild roller coaster for the crypto market over the past 48 hours. On Sunday, values dropped in a short period of time as investors realized U.S. tariffs on goods imported from Canada, Mexico, and China would hit as early as Tuesday. The stock market wasn't open over the weekend, so the selling initially started in crypto.

XRP (XRP) was one of the hardest hit, falling as much as 33.4% from Friday's close and currently trading down 11.3% over that period of time. But it wasn't the only one, with Solana (SOL) falling 20.2% at its low and Chainlink (LINK) down 32.8%, although the two tokens are now down 8.4% and 16%, respectively, from Friday to Monday at 3 p.m. ET.

Tariffs and the speculation that followed

By Sunday night, tariffs of up to 25% seemed imminent on goods coming into the U.S. from Mexico, Canada, and China. On top of that, retaliatory tariffs seem likely as well, at least from Mexico and Canada.

If that happens, the impacts on the U.S. economy and markets could be widespread, including a potential economic slowdown, rising inflation, and falling asset prices. Investors wanted to take risk off the table, and that's why valuations dropped so quickly.

By early Monday, tariff talk seemed to be slowing with a one-month delay on tariffs on goods coming from Mexico and discussions ongoing with Canada. The stock market began to recover, and crypto bounced off its lows, although values are still down from Friday's close.

Why crypto is impacted by tariffs

Cryptocurrencies aren't directly impacted by tariffs per se. This is a digital currency or asset, and it's not taxed as it crosses country borders.

But crypto is also a risky asset and as a high-risk asset, it trades correlated with growth stocks and other higher-risk assets. No surprise, growth stocks also started the day down sharply before recovering.

We have also seen that crypto doesn't act as a hedge to currency fluctuations or interest rates as many crypto bulls once projected. Instead, crypto values would likely fall if inflation picked up or if the economy went into a decline.

Fundamentals will ultimately drive crypto values

What XRP, Solana, and Chainlink have in common are fast blockchains that are intended to disrupt traditional financial and other digital transactions. So, there's a more fundamental value as opposed to meme coins or blockchains without user and developer traction.

Eventually, that should bode well for these blockchains, but that doesn't mean volatility won't follow.

We have also seen stablecoins become the preferred medium of exchange for most crypto transactions, which may hurt the demand for tokens. But it remains to be seen how the value of crypto assets plays out.

I think ultimately the fundamental use cases and innovation driven by the blockchain will drive value to tokens more than tariffs will impact any valuations. But today, that's not the narrative, and if the economy turns south, crypto will go with it. That may be the best time to be a buyer for the most disruptive cryptocurrencies and blockchains today.