Bitcoin continued to decline on Wednesday, failing to stay above the key level of $100,000, as escalating trade tensions between the US and China keep investors cautious.
Writes UNN with reference to Investing.
As of 1:45 a.m. EDT (06:55 GMT), bitcoin fell 1.8% to $97,601.8. Over the past two days, the cryptocurrency has briefly exceeded $100,000, but failed to gain a foothold at this level due to the intensification of the trade confrontation between Washington and Beijing.
The latest escalation began after the United States imposed 10 percent tariffs on Chinese imports, citing national security concerns. In response, China imposed counter-tariffs on American goods, including liquefied natural gas, coal, oil, and agricultural machinery.
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The escalation of the situation made investors act more cautiously, increasing volatility in the markets. For example, gold prices hit record highs as traders sought safe-haven assets in the face of uncertainty. Bitcoin's failure to gain a foothold above $100,000 reflects a broader trend of avoidance of risky assets.
At the same time, the US Securities and Exchange Commission (SEC) is downsizing its cryptocurrency regulation unit, reassigning lawyers to other agencies as part of the Trump administration's policy of reducing control over the cryptocurrency market.
A possible easing of regulatory control by the SEC could be a positive factor for bitcoin. However, general macroeconomic challenges, including the escalating trade dispute between the world's largest economies, overshadowed this potential momentum.
The impact of the reduction of the SEC's cryptocurrency division on ongoing enforcement efforts remains uncertain, the report notes.
Most altcoins showed restrained dynamics, trading in narrow ranges, indicating that investors are cautious about speculative assets.
Ether, the second largest cryptocurrency by capitalization, rose 0.5% to $2,741.53, while XRP, which ranks third, fell 1.1% to $2.4957. Solana lost 0.7%, Polygon remained almost unchanged, and Cardano was down 0.3%. Among the meme tokens, Dogecoin remained stable.
Recall
Yesterday, bitcoin and other major cryptocurrencies rose amid a positive market reaction to US President Donald Trump's decision to postpone the introduction of new tariffs on Canada and Mexico.