Bitcoin risks $75K drop as EU-US tariff tensions escalate

The European Union's retaliatory tariffs on $28 billion worth of U.S. goods, set to take effect in April, are raising concerns about heightened market volatility, including potential corrections in Bitcoin's (CRYPTO:BTC) price.

Analysts warn that these geopolitical tensions could push Bitcoin below the critical $75,000 support level.

The European Commission announced the tariffs on March 12 in response to the U.S. imposing a 25% tariff on steel and aluminum imports.

This move reignites fears of a prolonged trade war, which could weigh on global financial markets and cryptocurrencies.

Marcin Kazmierczak, COO of blockchain oracle firm RedStone, noted that counter-tariffs often signal further retaliatory actions, adding that Bitcoin could revisit $75,000 amid these uncertainties.

However, he also suggested that stablecoins and real-world assets remaining at all-time highs might offer some support for a rebound.

Ryan Lee, chief analyst at Bitget Research, emphasised that while Bitcoin is influenced by macroeconomic conditions like trade policies, other factors such as institutional adoption and regulatory developments also play a significant role.

"The prices are correlated with wider economic conditions but are also influenced by factors beyond trade policies," Lee explained.

Bitcoin has already experienced a 7% decline over the past week, trading at $81,000 as of March 12.

Trading volumes have also dropped significantly, reflecting reduced investor activity amid growing uncertainty.

Analysts from Nansen highlighted that "tariff noise" is likely to persist until after April 2 when reciprocal tariff announcements and negotiations may provide more clarity.

This ongoing tension is expected to limit risk appetite across traditional and cryptocurrency markets.

Historically, such geopolitical developments have led to increased volatility in Bitcoin markets.

For instance, following the U.S.'s initial tariff announcement in February, Bitcoin saw sharp declines alongside a surge in trading volumes as investors reacted to the news.

As Europe’s new tariffs take effect by mid-April, market participants remain cautious about how escalating trade disputes will impact Bitcoin and broader financial markets.

The interplay between macroeconomic pressures and cryptocurrency resilience will be closely watched in the coming weeks.

At the time of reporting, the Bitcoin (BTC) price was $83,552.09.