The cryptocurrency market faced significant volatility this week as President Donald Trump announced sweeping tariff policies affecting both traditional and digital assets.
Sharp Decline in Cryptocurrencies
Following Trump's announcement, the total market capitalization of cryptocurrencies plunged by over 5% to a low of $2.64 trillion. Bitcoin saw a 2.5% drop, while Ethereum and Solana suffered losses of 6% and 6.6% respectively. The crypto derivatives markets experienced $509 million in liquidations, including $176 million in Bitcoin-focused positions. A total of 181,544 traders saw their positions liquidated.
Reasons Behind the Sell-Off
The catalyst for the sell-off was Trump's aggressive tariff strategy, which introduced a 10% baseline tariff on all imports and a 25% tariff on foreign-made cars. Reciprocal tariffs set to take effect on April 9 will impose up to 54% tariffs on certain nations, including China.
Bitcoin's Future
With Bitcoin stabilizing around $82,000-$84,000, analysts remain divided on the next move. Some see this as a short-term correction, while others believe that if macroeconomic pressures persist, further challenges may lie ahead.
The new tariff measures have unsettled the markets, leaving Bitcoin's further reaction uncertain. Some investors may shift focus to more traditional safe havens like gold.
