- Bitcoin fell to $91,000 after Trump’s 25% Mexico-Canada tariffs and 10% China levy sparked global trade uncertainty
- Ethereum, Binance Coin, and Solana dropped 12-18%, mirroring Bitcoin’s decline amid broader market caution and liquidity outflows.
- Historical data shows Bitcoin often rebounds post-sharp drops, with 2023’s 40% recovery suggesting potential near-term stabilization.
Bitcoin fell to $91,000 earlier this week, sparking renewed debates about how global economic policies influence cryptocurrency markets. The drop coincided with updated trade tariffs announced by former U.S. President Donald Trump, which targeted imports from Mexico, Canada, and China. Analysts link the decline to heightened uncertainty in traditional financial markets, which often spills into digital asset trading.
Trump’s tariffs include a 25% duty on goods from Mexico and Canada, alongside a 10% levy on Chinese imports. These measures have intensified trade friction, creating ripples across equities, commodities, and cryptocurrencies. Bitcoin, tends to react sharply to macroeconomic shifts. Investors moved capital away from riskier holdings this week, with Bitcoin’s price reflecting this trend.
The sell-off extended beyond Bitcoin
Ethereum, Binance Coin, and Solana each dropped between 12% and 18% over 48 hours. Such parallel declines highlight the interconnected nature of cryptocurrency markets, where sentiment shifts frequently affect multiple assets simultaneously. Data from exchanges also showed increased inflows into gold and government bonds, suggesting a short-term pivot toward stability among some investors.
Market observers note that Bitcoin’s volatility remains a double-edged sword. While abrupt drops attract attention, historical patterns show recoveries often follow steep declines. For example, Bitcoin rebounded by 40% within two weeks after a similar drop in late 2023. Current trading volumes suggest some buyers are entering the market at lower price levels, though caution persists due to unresolved trade tensions.
The tariffs’ long-term impact on cryptocurrencies remains unclear
Trade policies could slow economic growth in affected regions, potentially altering investment strategies in emerging markets. However, Bitcoin’s decentralized structure insulates it from direct policy changes, unlike traditional assets tied to specific governments or industries.
Analysts from firms like Blockware Solutions and CoinShares argue that Bitcoin’s utility as a hedge against inflation and currency devaluation could regain traction if trade disputes escalate. For now, the market’s direction hinges on geopolitical developments and broader economic signals. Traders await further clarity on tariff enforcement timelines and potential retaliatory measures from impacted nations.
Bitcoin traded near $91,500 at publication time, with derivatives markets indicating neutral-to-cautious sentiment. The coming weeks will test whether the cryptocurrency’s recent drop represents a temporary correction or the start of a broader adjustment phase.
