After the announcement of drastic US tariffs, it seemed as if cryptocurrencies would almost be able to maintain their prices. But now they’re plummeting.
Bitcoin has also not been spared from developments on the financial markets. The price temporarily fell below $75,000 on Monday. This means that the most important cryptocurrency has now lost almost all of the gains it made after Donald Trump’s election as US president. Bitcoin first reached the $75,000 mark on election night, and in the weeks following, the price even rose to more than $100,000. Since Trump’s inauguration, however, the price has been steadily declining, even though the US president now actually wants to be perceived as a friend of cryptocurrencies. The announcement of massive tariffs merely caused the final price correction.
Over the past seven days, all cryptocurrencies have plummeted sharply; Bitcoin’s loss of over 8 percent is still comparatively small. Ethereum has lost almost 19 percent of its value over the same period, as has XRP. Solana has even plummeted by almost 23 percent, and Cardano is currently down a good 20 percent. All five cryptocurrencies are now worth significantly less than they were at the beginning of March – at that time, Trump announced that they would become part of a US strategic crypto reserve, triggering significant price surges. According to data from CoinMarketCap, the market capitalization of all cryptocurrencies has fallen by more than 11 percent, or well over $200 billion, since Sunday alone.
Shortly after the announcement of the massive tariff package, it seemed as if Bitcoin might escape the losses of traditional financial markets, even though its price had fallen. That no longer seems to be the case. Donald Trump has declared war on trading partners around the world by imposing tariffs on almost all imports. Accordingly, tariffs of ten percent now apply across the board to imports from virtually all countries. Many will face significantly higher punitive tariffs depending on their trade deficits. Further tariffs of 20 percent are planned for imports from Germany and other European Union countries into the US.
Trump, who during his first term was a critic of cryptocurrencies like Bitcoin and feared for the dominance of the US dollar, has changed his stance during the election campaign. In return, his campaign received millions in donations from the industry, which hopes for much more freedom from the new administration. Support was also provided to candidates for the US Congress, who are expected to incorporate their wishes into legislation. So far, there has been little criticism of Trump’s policies from the US Congress, and on Monday, traditional financial markets also came under further pressure.
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