On Monday, the cryptocurrency market dropped steeply as US President Donald Trump levied tariffs on China, Mexico, and Canada and more are forecast for European Union products. The increasing trade war caused almost $2 billion in crypto market liquidation, thereby quite affecting investor attitudes.
Major Losses Hit Bitcoin and Ethereum
At 13:58 IST, Bitcoin was trading at $95,300 its lowest level in three weeks, therefore 4.4 percent. This is its lowest level since $94,948.1 on January 14. Ethereum, on the other hand, slumped 17.8 percent to $2,556, its lowest since November 4.
Co-founder and CEO of Pi42, Avinash Shekhar, offered his view on the state, “The crypto market remains on a knife’s edge amid global policies and changing investor sentiments. The slip of Bitcoin below $100,000 is a quest for resilience, with key support levels at $95,000 and $90,000 that define the line of battle for bulls and bears.”
Why Is the Crypto Market Lower Today?
Growing worries about Trump’s tariff policies, which have exacerbated global economic risks, are to blame for the sell-off according to market experts. Shekhar clarified, “Donald Trump imposed tariffs on Canada, Mexico and China, which led to nearly $2 billion in liquidations in the crypto market as the whole crypto market is bleeding red.”
State CoinSwitch Markets Desk, “With US President Trump imposing massive tariffs on certain countries, the Asia open marks one of the largest liquidations in the crypto markets in recent times, with approximately $2 billion in liquidations in the last 12 hours alone.”
Effective Tuesday, Trump’s new direction of a 25 percent tariff on Canada and Mexico and a 10 percent duty on China has sparked fresh trade conflict. Furthermore, eroding investor trust, the ex-president also said he would soon implement tariffs on European Union goods.
Where will the crypto market go next?
Shekhar thinks macroeconomic factors and investor confidence will still affect digital asset trends. Bitcoin’s bouncing over $100,000 could restart market momentum, but prudence is still necessary. He said, “Crypt markets live on volatility; obviously, a bearish market today might set the scene for bullish signals tomorrow.”
Moreover, changing worldwide legal outlooks are causing India to rethink its attitude toward digital assets. In a recent interview, Economic Affairs Secretary Ajay Seth said, “India’s position cannot be unilateral; don’t believe in borders.”
$90,000 gives strong support to Bitcoin
CoinSwitch Markets Desk notes that with Bitcoin at the $90,000 level, there is strong support, making a more downward break unlikely particularly as gold prices reach an all-time high. BTC dominance has also jumped substantially to 61%, which suggests that investors are in a risk-off state of mind.
The next steps of the crypto market will depend on outside economic circumstances, investor confidence, and global regulatory changes as international trade policies keep changing.
