Bitcoin and Ether Prices Plummet Amid Rising Trade Tensions
Bitcoin and Ether prices fell sharply, with Bitcoin dropping to $92,580 and Ether losing 24% to $2,300. This decline was spurred by President Trump’s new tariffs on imports from Canada, Mexico, and China, leading to investor uncertainty. Approximately $1.79 billion was liquidated in the crypto market within a day, reflecting the risks associated with current trade tensions.
On Monday, Bitcoin and Ether faced notable declines due to escalating global trade tensions. Bitcoin’s price plummeted to $92,580, its lowest in three weeks, and eventually recovered slightly to $93,727.53. Ether also fell significantly, experiencing a 24% drop, which brought its value down to $2,300, marking its steepest decline since September. The decline followed a 7% drop in Bitcoin over the weekend, while Ether reached its lowest level since November with a 20% decrease.
The market’s downturn follows President Trump’s announcement of new tariffs, including a 25% tax on imports from Canada and Mexico and a 10% tax on Chinese products, set to take effect on Tuesday. The trade relations between the U.S. and these countries involve annual transactions exceeding $1.6 trillion. The tariffs elicited retaliation pledges from Canada, Mexico, and China, intensifying investor anxiety about the potential economic repercussions.
Chris Weston from Pepperstone suggests that the current uncertainty leads crypto markets to act as a “risk proxy.” Rising tensions among nations can incite apprehensions about price inflation, business performance, and market growth. Following the tariff announcement, the crypto market suffered $1.79 billion in liquidations within 24 hours, affecting over 450,000 traders. Long positions accounted for $1.57 billion of liquidated assets, with short positions amounting to $219 million.
Notably, Bitcoin reached an all-time high of $107,071.86 on January 20 due to positive investor sentiment surrounding anticipated favorable cryptocurrency regulations post-election. However, the slow progression in regulatory measures has disappointed many stakeholders. Despite the recent price decline, Bitcoin continues to be regarded by several investors as a protective asset against inflation and economic volatility.
Market analysts are keenly monitoring Bitcoin’s performance around the $90,000 threshold. The cryptocurrency’s long-term viability is closely tied to the state of global economic conditions and ongoing trade disputes, which could potentially lead to further losses in light of increased trade tensions. Investors remain notably cautious as they assess the implications of these developments on their portfolios.
The market for cryptocurrencies, particularly Bitcoin and Ether, has remained volatile, heavily influenced by external factors such as global trade dynamics and governmental policy changes. The impact of President Trump’s tariffs not only stirred uncertainty among investors concerning immediate financial outcomes but also raised larger concerns about international trade relations and the overall economic landscape. Understanding these factors is critical to comprehending the fluctuations in cryptocurrency valuation, particularly in times of economic instability.
In summary, the recent significant declines in Bitcoin and Ether prices underscore the sensitive nature of the cryptocurrency market to geopolitical events, particularly trade conflicts. While tariffs imposed by President Trump triggered immediate market reactions, the long-term implications for Bitcoin continue to hinge on macroeconomic conditions. Despite short-term volatility, many investors maintain a positive outlook on Bitcoin as a central asset for hedging against future economic uncertainties.
Original Source: www.cryptotimes.io
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