The crypto market has continued to plunge, taking a nosedive this week, declining 4.42% to a market capitalization of $2.43 trillion, as U.S President Donald Trump’s Tariffs spark widespread panic among investors.
Bitcoin fell 4.1% to $76,550, dipping below $75,000 on Tuesday, while Ethereum suffered an even sharper 8.3% drop over the past 24 hours, hitting $1,435.43, its lowest since March 2023. Bitcoin is now reportedly down 30% from its January 2025 peak of $109,000, reached shortly before Trump’s inauguration. The crypto asset market capitalization currently stands at $1.515 trillion, with a trading volume of over $53.73 billion.
The second largest cryptocurrency Ethereum, has fallen 70% from its November 2021 high of $4,891.70. Its market cap is currently $173.72 billion, with a 24-hour volume of $25.11 billion. Experts state that Ethereum might be responding more severely to macroeconomic uncertainty.
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The altcoin market is also not exempted, as it has suffered significant losses. Dogecoin dropped 6.75% to $0.1420, while Solana and Cardano fell 18% and 23.7% over the past week respectively. TRON (TRX) fell more modestly, down 2.91% to $0.2268.
Meanwhile, stablecoins such as USDT and USDC held strong, highlighting their haven status in times of global economic uncertainty. Stablecoins such as Tether (USDT) and USD Coin (USDC) held their ground. USDT traded for $0.9991 with only a 0.05% fluctuation, while USDC was still pegged at $1.00 without any variation.
As Donald Trump’s tariff war sparks widespread concern of US recession, debates over Bitcoin’s “digital gold” status have picked up once again. Long-term players continue to remain bullish about BTC despite this volatility. Hunter Horsley, the CEO of Bitwise Investments, noted.
“As nations trust each other less. As corporations have more difficulty doing business. A global, digital, apolitical store of value controlled by no nation looks increasingly differentiated. Bitcoin’s place in the world has never been more valuable”, he added.
Amidst the decline of crypto market, several analysts have offered a mix of perspectives on Bitcoin’s trajectory in light of the new tariffs. Some predict that if trade tensions persist, Bitcoin’s price could test lower support levels, potentially dropping to around $71,000. Conversely, others argue that Bitcoin may serve as a hedge against economic instability, with the potential for its price to rebound above $91,000 if investors seek refuge from traditional financial markets.
Pejman cautioned that Bitcoin risks “heavy declines” if it can’t hold critical support, while Kevin Capital forecasts a dip to $78,000, citing sparse liquidity up to $80,000 but a denser pocket near $90,000. Melika Trader’s TradingView analysis, paints a darker picture of a possible 60% plunge of Bitcoin to $49,000.
Zach Burks, CEO of NFT platform Mintology, suggests that in the long term, institutional investors might shift capital toward cryptocurrencies like Bitcoin to distance themselves from unstable, tariff-impacted traditional markets. This perspective aligns with the view of Bitcoin as “digital gold,” offering a store of value during periods of economic uncertainty.
Although the crypto market today looks all in red, some experts think the decline could be a healthy correction and not a reversal of the long-term trend. Crypto is understood to always recovered from such dips, especially when fueled by external economic factors.
Future Outlook
President Trump’s tariff announcement has introduced significant volatility into the cryptocurrency market, with Bitcoin and other digital assets experiencing notable price declines.
The cryptocurrency market’s response to the tariff announcement underscores its sensitivity to macroeconomic policies and global trade dynamics. In the short term, heightened volatility is expected as investors adjust their portfolios in response to evolving trade policies and economic indicators.