The Crypto Fear and Greed Index has plunged to 25 following the announcement of new U.S. import tariffs by President Donald Trump.
Impact of New Tariffs on Markets
On April 2, U.S. President Donald Trump announced the imposition of new import tariffs, causing concern in both traditional and cryptocurrency markets. The new baseline tariff is set at 10%, but rates are significantly higher for specific countries. China faces a 54% tariff, the European Union at 20%, and Vietnam, Taiwan, India, and Japan at 46%, 32%, 26%, and 24% respectively. Canada and Mexico are temporarily exempted from these tariffs.
Crypto Market Reaction
The tariff announcement led to a sharp drop in U.S. stock markets: the Dow fell over 1000 points, with S&P 500 and Nasdaq also suffering significant losses. The crypto market mirrored these declines, with the broader crypto market capitalization shrinking by 4% to $2.7 trillion. Bitcoin initially spiked to $88,500 but then fell to $83,073, down 2% over the past 24 hours. Ethereum and Solana experienced losses of 4% and 5.2% respectively, while total liquidations in the market amounted to $514 million, according to Coinglass data.
Expert Opinions
Arthur Hayes, the co-founder of the BitMEX crypto exchange, commented on the potential impact of the new tariffs, stating that the market could recover if Bitcoin stays above $76,500 until April 15, the U.S. tax day. He also cautioned investors against making hasty decisions.
Trump's tariff announcement led to a significant drop in both traditional and cryptocurrency markets, increasing uncertainty among investors.
