Bitcoin has fallen below $80,000 for the first time since November amid concerns over Trump tariffs. This article explores the contributing factors and provides expert forecasts.
Sharp Drop and Its Causes
According to crypto.news, as of February 28, Bitcoin's price has dropped by 6% to $79,800. This has increased pressure on investors, many of whom were expecting support at the $82,000 level. Several factors have caused the decline: macroeconomic uncertainty and proposed 25% tariffs by Donald Trump on imports from Canada, Mexico, and the European Union. These factors have raised fears of rising inflation, leading to increased demand for safe-haven assets like the dollar and U.S. Treasuries.
Investor Reactions and Market Changes
Institutional investors have started to pull back, as evidenced by $275 million in net outflows from U.S. Bitcoin ETFs on February 27. Total outflows for the week reached $2.7 billion. Interest in Bitcoin has waned despite the $109,000 level reached in January. Amid general uncertainty, traders remain optimistic as social media buzzes with 'buy the dip' despite the risks of further declines.
Bitcoin's Future and Expert Predictions
BitMEX co-founder Arthur Hayes warned that Bitcoin is in a downtrend and may dip below $80,000, eyeing the $70,000-$75,000 range as the next step if Trump fails to forward his budget plans. With the current market conditions, Bitcoin's short-term outlook remains uncertain.
The drop in Bitcoin's price below $80,000 underscores the influence of macroeconomic factors and international policy on cryptocurrency markets. Concerns over tariffs and their potential implications for inflation highlight the need for caution in investment strategies.
