Bitcoin and altcoins continue to experience a steep decline due to economic uncertainty and international events.
Reasons for the Decline in Bitcoin and Altcoins
The leading cryptocurrency Bitcoin (BTC) faced a wave of selling since yesterday evening and fell below $89,000. Altcoins saw bigger losses, with Ethereum (ETH) down 9.5% and Solana (SOL) down 12.4%, while the overall crypto market is down 7.4% in the past 24 hours.
Market Reaction to Economic Uncertainty
The decline in Bitcoin was attributed to uncertainty in the market and US President Donald Trump's announcement of plans to impose tariffs on Canada and Mexico. Geoffrey Kendrick, Global Head of Digital Assets Research at Standard Chartered, stated that the risk aversion that emerged in traditional markets also affected the Bitcoin and cryptocurrency sector.
Prospects for Cryptocurrency Recovery
Although the outlook for Bitcoin and cryptocurrencies is negative in the short term, Kendrick stated that he foresees a recovery in the medium term. He warned that Bitcoin could fall to as low as $80,000 before a recovery occurs. The U.S. personal consumer spending price index data, which the Fed closely follows to measure inflation, will be released on Friday, possibly impacting the crypto market.
While the cryptocurrency market is declining due to external economic factors, analysts foresee potential recovery in the future. These processes will depend on economic indicators and Federal Reserve decisions.
