Bitcoin fell by 10% after Donald Trump imposed trade tariffs, which caused panic in the crypto market. Investors began to get rid of risky assets amid the escalation of the trade war between the US, China, Canada, and Mexico.
Writes UNN with reference to Investing.
Bitcoin fell sharply on Monday, reflecting a general decline in cryptocurrency prices. Investors began to avoid risky assets amid US President Donald Trump's decision to impose trade tariffs on China, Canada, and Mexico.
The drop in the crypto market came as Wall Street futures fell by more than 1.5% as traders prepared for an escalation of the trade war. Trump imposed a 25% tariff on imports from Canada and Mexico, as well as a 10% tariff on Chinese goods, which prompted promises of retaliation from all three countries and further undermined confidence in risky assets.
Bitcoin dropped 10% to $91,695.8, while Ether, the second largest cryptocurrency by capitalization, fell 22.7% to $2,434.84. The $TRUMP memecoin, which Trump launched in January, lost more than 15%, dropping to a record low of $16,349.
The tariffs have largely overshadowed the prospects for more favorable regulation of the crypto market under the new president. In addition, Trump's latest executive order on the creation of a regulatory framework for cryptocurrencies did not generate much enthusiasm among investors.
Trade restrictions led to a general decline in risk appetite in global financial markets, while strengthening the dollar, which reached a nearly one-month high. Demand for safe-haven assets, such as gold, also increased, although the dollar remained the main focus for investors.
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Analysts warn that the new duties could push up inflation in the US, slow economic growth and reduce the likelihood of the Federal Reserve easing its monetary policy.
Recall
Last week, the cryptocurrency market was volatile after US President Donald Trump's statements about the possible introduction of 100% tariffs on BRICS countries.