Bitcoin Drops 3% as Trump Tariff Stir Uncertainty
Fhumulani Lukoto
- 2 min read
Key Takeaways
- Trade tensions spooked investors: Concerns that new tariff moves could disrupt global trade flows made markets uneasy, especially with uncertainty surrounding policy direction in the US.
- Crypto showed its sensitivity to headlines: BTC’s quick drop highlights how digital assets often react instantly to political and economic news, sometimes faster than traditional markets.
- Volatility remains the norm: The decline is another reminder that BTC prices can swing sharply when macroeconomic fears rise, keeping traders cautious in the short term.
On Monday, after United States President Donald Trump announced plans to raise global tariffs to 15%, Bitcoin (BTC) fell to 5% below $65,000.
The drop occurred even as Asian stocks climbed in early trading, highlighting crypto’s divergence from regional equity markets amid renewed tariff uncertainty.
Markets Shaken as Tariff Concerns Grow
The latest pressure came after indications that the US may pursue new or expanded tariffs on key imports. Even the possibility of additional trade barriers can unsettle markets, as investors fear higher costs for businesses, supply chain disruptions, and strike back measures from trading partners.
Tariffs tend to strengthen the dollar in the short term while dampening appetite for speculative assets. Because cryptocurrencies are often treated as high-risk investments, they can be among the first to sell off when traders shift toward safer holdings such as government bonds or cash.
Market strategists note that crypto’s sensitivity to political developments has grown over the past two years. Once seen as largely detached from traditional finance, BTC now frequently reacts to the same macroeconomic signals that drive equities, commodities, and currencies.
Bitcoin Slumps After Record High
Bitcoin (BTC) has faced a steep decline since surpassing $125,000 in October last year, with losses continuing into the new year. The leading crypto has fallen 26% year-to-date and is down more than 47% from its October peak.
The slide has erased billions of dollars in market capitalisation and dampened the optimism that followed last year’s rally. The renewed focus on tariffs has just added another layer of concern.
Outlook Hinges on Policy Clarity
Looking ahead, traders say the direction of crypto markets may depend less on blockchain-related developments and more on macroeconomic signals.
Despite the recent drops, some long-term investors remain optimistic, viewing pullbacks as part of BTC’s historically cyclical nature.
COO at a global blockchain technology company BTSE, Jeff Meisaid, said, “We believe that the sudden uptick in tariff rates is causing investors to sell crypto assets in anticipation of a more serious market decline.”
As investors sought safety, gold prices climbed, moving sharply in the opposite direction of BTC. Meanwhile, BTC recovered slightly but was still down. Ethereum (ETH) also slipped down.
For now, the latest slide serves as a reminder that even decentralised digital assets are not immune to real-world policy decisions; a Tariff announcement can ripple just as quickly through crypto charts as it does across traditional financial screens.
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Fhumulani Lukoto
Cryptocurrency Journalist
Fhumulani Lukoto holds a Bachelors Degree in Journalism enabling her to become the writer she is today. Her passion for cryptocurrency and bitcoin started in 2021 when she began producing content in the space. A naturally inquisitive person, she dove head first into all things crypto to gain the huge wealth of knowledge she has today. Based out of Gauteng, South Africa, Fhumulani is a core member of the content team at Coin Insider.