Bitcoin Drops 5% on Tariffs
Bitcoin fell as much as 5% to $64,270 before recovering to $66,300 following Trump's new tariff moves. The sell-off was amplified by whale selling and thin liquidity, with large holders moving coins to exchanges and short-term investors locking in losses. XRP dropped 4% and faces its biggest realized loss spike since 2022.
- The new 15% global tariff was announced after the U.S. Supreme Court ruled that President Trump's previous use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs was unconstitutional. The administration is now citing Section 122 of the Trade Act of 1974, an authority no previous president has used to impose tariffs. - The market move reflects a broader "risk-off" sentiment, where investors exit assets perceived as volatile during times of economic uncertainty. Analysts note that despite its "digital gold" narrative, Bitcoin still often trades like a high-risk tech stock during macroeconomic stress. - Institutional demand has weakened, with U.S.-listed spot Bitcoin ETFs recording a fifth consecutive week of outflows, totaling $315.86 million in the last week. Trading volumes for all crypto exchange-traded products dropped to the lowest level seen since July 2025. - The Crypto Fear & Greed Index, a measure of market sentiment, has fallen four points to a value of 5, indicating "Extreme Fear" among investors. The downturn triggered a cascade of forced selling, with more than $459 million in leveraged crypto positions liquidated in a 24-hour period. - On-chain data shows a significant spike in net realized losses for Bitcoin investors, with one metric showing a recent plunge to -$1.24 billion per day before moderating. This indicates that recent buyers are selling their holdings at a loss. - Analysts are now closely watching the $60,000 mark as the next major technical and psychological support level for Bitcoin. A sustained break below the recent low of about $64,300 could open the door for a deeper correction. - The U.S. Customs and Border Protection agency is scheduled to stop collecting the tariffs deemed illegal by the Supreme Court on February 24, the same day the new 15% global tariff is set to take effect. - Beyond the direct impact on market sentiment, tariffs can also increase operational expenses for cryptocurrency miners by raising the prices of imported computer hardware and semiconductor chips.
