The steep decline comes in response to Trump’s announcement of a 25% tariff on European imports, citing allegations that the EU has long engaged in unfair trade tactics against the U.S. [Image Source: Shutterstock]As of today, Bitcoin is trading around $84,402, marking a 4.27% drop from its previous close. The cryptocurrency briefly touched an intraday high of $89,277 before plummeting to a low of $82,464. This downturn represents a 23% decline from Bitcoin’s January peak of $109,350, officially placing it in bear market territory.
Ethereum and other major digital assets are also feeling the impact. Ethereum has dropped 6.7% to trade at $4,850, down from an opening price of $5,200. The broader cryptocurrency market has seen similar losses, as traders react to increasing economic uncertainty.
The sharp selloff follows Trump’s declaration that he intends to impose a 25% tariff on European imports, accusing the EU of unfair trade practices.
“The European Union was formed to take advantage of the United States,” Trump stated. “For too long, we’ve allowed them to manipulate trade. That ends now.”
The aggressive trade policy has heightened fears of a global economic slowdown, prompting investors to reassess their exposure to volatile markets, including cryptocurrencies. Traditionally, Bitcoin has been seen as a hedge against inflation and economic instability, but in this case, it appears to be mirroring broader risk-off sentiment.
Beyond macroeconomic factors, the crypto sector has been hit by internal challenges. A major hack on Bybit, a leading cryptocurrency exchange, resulted in the theft of $1.5 billion worth of digital assets. This breach has further shaken investor confidence in the security of crypto platforms.
Additionally, Bitcoin exchange-traded funds (ETFs) have witnessed significant outflows, with investors pulling out over $1.1 billion in a single day. The exodus signals growing caution among institutional investors who had been key drivers of Bitcoin’s surge in recent months.
Technical indicators suggest that Bitcoin may continue to struggle in the short term. The Relative Strength Index (RSI) is approaching oversold territory, while a bearish crossover in the Moving Average Convergence Divergence (MACD) points to continued downward momentum.
Market analysts warn that if Bitcoin breaks below its next critical support level of $80,000, a further slide toward the $70,000 to $75,000 range could be possible.
“The combination of geopolitical uncertainty, declining institutional inflows, and security concerns has created a perfect storm for Bitcoin,” said market strategist Daniel Hayes. “We may see further downside before a recovery.”
Despite the recent turbulence, some analysts remain optimistic about Bitcoin’s long-term potential. On-chain data shows that Bitcoin’s market dominance has risen to 62%, a sign that traders still view it as a leading asset in the crypto space.
Some investors also believe that once the dust settles on Trump’s trade policies, Bitcoin could regain strength as a hedge against economic uncertainty.
Bitcoin’s sharp drop below $84,000 is a reflection of mounting global economic tensions, exacerbated by Trump’s trade policies and internal security concerns within the crypto industry. As the market navigates these challenges, all eyes will be on key support levels and institutional flows to determine whether Bitcoin can recover or if more downside is ahead.
Trump-linked crypto firm raises $220M for Bitcoin mining
Texas enacts 'Asset Forfeiture' law SB1498
Coinbase becomes the first U.S. firm with EU MiCA license
Senate passes GENIUS Act to clarify stablecoin rules
Stay ahead with the latest updates, insights, and trends shaping the world of cryptocurrency and blockchain technology.
