Trump's Tariffs & Crypto: Market Impact
US President Trump's announcement of upcoming reciprocal tariffs has sent ripples through global markets, raising concerns about a potential cryptocurrency market downturn. This follows earlier tariff-related market volatility.
Trump's Reciprocal Tariffs: Crypto Market Implications
Bloomberg reported President Trump's plan to unveil reciprocal tariffs, potentially escalating trade tensions with key allies, including the European Union. This economic uncertainty negatively impacts the crypto market, creating a bearish sentiment among traders. Recent events highlight this vulnerability.
Earlier this week, tariffs on Mexico, Canada, and China led to a market crash with over $2 billion liquidated across major cryptocurrencies like Bitcoin, XRP, Dogecoin, and Solana. Although a temporary reprieve was reached, the proposed reciprocal tariffs reintroduced market anxieties.
Bitcoin's price remains volatile around $96,000, mirroring the broader market stagnation. Given the current climate, further price drops are a possibility following the tariff announcement. Coinglass data shows over $250 million exited the market in the past 24 hours, impacting both long and short traders.
Whale Activity: A Bullish Counterpoint
Despite the risk of a significant crash, some market indicators suggest resilience. Crypto whales, large investors, are demonstrating bullish sentiment, using the downturn to accumulate assets. Analyst Ali Martinez highlighted the withdrawal of over 70,000 BTC from exchanges in the past week.
While some predict Bitcoin prices could drop to $90,000, experts maintain a bullish outlook, viewing this as a buying opportunity. Cardano founder Charles Hoskinson's positive 2025 prediction reinforces this sentiment.
Other Influencing Factors
Beyond Trump's policies, other factors influence the crypto market. The US Federal Reserve's hawkish stance and potential quantitative tightening policies are key concerns. However, recent positive US job data, suggesting slowing labor market growth, could influence the Fed's approach.
The upcoming US CPI inflation data is crucial. Cooling inflation could encourage the Fed to adopt a more dovish stance, potentially boosting the crypto market. Investors should closely monitor these developments alongside President Trump’s actions.
Codeum Note: At Codeum, we provide comprehensive blockchain security services, including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consultation, and partnerships with launchpads and crypto agencies to mitigate risks associated with the volatility of the crypto market.
Disclaimer: This analysis reflects current market conditions and the author's opinion. Conduct thorough research before making any investment decisions. Codeum is not responsible for personal financial losses.