Bitcoin's price fell below $75,000 amid a renewed escalation of the trade war between the United States and China.
During the first week of April, cryptocurrencies remained an island of stability amid the global turmoil caused by the United States' global tariffs. However, on Monday morning, the trend reversed: Bitcoin, the world's most popular cryptocurrency, fell below $75,000, although it later rebounded slightly.
Bitcoin's price thus fell far below the peak of $106,000 it reached on December 17, amid expectations for Trump's initial decisions. Meanwhile, Ether, the second-largest cryptocurrency, fell by more than 13%, well below $1,502 per unit. Both currencies account for more than 70% of the global cryptocurrency market capitalization, exacerbating the situation for investors in this market.
“The imposition of tariffs creates an environment of uncertainty that increases risk aversion, reduces liquidity due to economic uncertainty, and encourages investors to steer clear of high-risk assets such as cryptocurrencies. Furthermore, the Federal Reserve's monetary policy and the global volatility of traditional markets are exacerbating this bearish sentiment,” Matías Silva, General Manager of Skipo, a digital wallet focused on buying and selling cryptocurrencies , explained to AméricaEconomía .
The fall in global stock markets and commodity prices was compounded by the Chinese government's announcement that it would impose "retaliatory" tariffs of 34% on goods imported from the U.S. This explains why Bitcoin had already closed below US$82,000 on Friday the 4th.
According to Silva, in the short term, tariffs amplify cryptocurrency declines through leveraged liquidations. And while Trump openly supported the use of these assets, Bitcoin adoption could stagnate if the US economy weakens. "Investors should consider the macroeconomic impact alongside crypto fundamentals," he warns.
However, all is not lost. Although the downward trend in stock markets has "infected" cryptocurrencies, their potential as a hedge against the economic crisis remains. In Silva's words, Bitcoin maintains solid fundamentals such as scarcity and growing adoption. The spokesperson believes that crypto volatility reflects a temporary adjustment, not a structural failure, and Trump's pro-crypto policies would soon be implemented.
