Bitcoin experienced a sharp drop below the $100,000 mark following US President Donald Trump's signing of an executive order to impose tariffs on imports from Canada, Mexico, and China.
Global Reaction to Economic Measures
The introduction of tariffs prompted swift responses from affected nations. Canadian Prime Minister Justin Trudeau announced plans to impose a 25% tariff on American products valued at $106.5 billion. China's Ministry of Commerce also stated its intent to file a complaint with the World Trade Organization and prepare countermeasures. Mexico's President Claudia Sheinbaum instructed her government to execute 'Plan B,' a strategy involving both tariff and non-tariff responses.
Fears and Volatility in the Crypto Market
These geopolitical tensions have led to increased market volatility. Coinglass data indicates roughly $21.29 million in long Bitcoin positions were liquidated within hours.
Divided Opinions Within the Crypto Industry
The crypto community is split over how the escalating tariff war might impact the digital asset market. Dan Gambardello, founder of Crypto Capital Venture, dismissed concerns, stating 'BlackRock is still accumulating BTC and ETH while retail investors are panicking.' Bitwise Invest's head of alpha strategies, Jeff Park, expressed a bullish outlook, suggesting that prolonged trade conflicts might benefit Bitcoin in the long run. Nonetheless, not everyone shares this optimism. Adam Cochran, partner at Cinnaeamhain Ventures, warned of impending financial hardship, noting 'Bitcoin is not isolated enough from global economic forces and trades like triple-leveraged tech stocks.'
The current scenario highlights Bitcoin's vulnerability to global economic shifts, generating division among the crypto community and emphasizing the need for careful consideration of investment in the asset.
