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The crypto market is feeling the heat again, with Bitcoin, Ethereum, Dogecoin, and XRP all taking a major hit. Bitcoin has fallen by 10%, Ethereum by 15%, and XRP by 17%. The selloff is being driven by concerns over President Trump’s tariffs and growing fears of a potential recession.
Crypto analysts say Bitcoin’s price drop is due to CME gaps. Analyst Hardy pointed out that Bitcoin filled one gap today but needs to drop to $85,000 to fill another, with a bigger gap at $77,900 still open. He believes filling these gaps will pave the way for Bitcoin’s next rally. Titan of Crypto also sees a pullback before Bitcoin moves up again, which seems to be happening now.
As per The Kobeissi Letter, between 10:00 AM and 3:30 PM ET, the S&P 500 erased a whopping $1.5 trillion in market cap. Notably, the selling pressure began ahead of Trump’s ‘investment announcement.’
The investment announcement began on a strong note, with Taiwanese semiconductor company announcing a $100B investment in the US. The move is expected to generate “hundreds of billions of dollars” in economic activity. Further, President Trump confirmed that 25% tariffs on Canada and Mexico will start tomorrow, March 4th, where markets had hoped these tariffs would be delayed again.
Adding to the concerns, shortly after, the White House announced that President Trump signed an Executive Order raising tariffs on China to 20%. This marks a 20% increase in China tariffs over the past two months.
Crypto markets took a sharp dive as no new details on the US Crypto Reserve emerged. Nearly $300 billion was wiped off the market cap, erasing most of yesterday’s gains.
Besides, Trump’s announcement that the crypto reserve will include altcoins like Solana, Cardano, and XRP surprised many, who expected only Bitcoin to be included. Mixed reactions are adding to the market crash, as investors question the reserve’s credibility.
Ethereum has now erased all of its post-crypto reserve announcement gains. Prior to Sunday’s news, ETH was at $2,170, and it’s now dropped to a new low of $2,094, which is 3.5% lower than before Trump’s announcement. Altcoins like Ethereum, Dogecoin, and XRP are falling as they closely follow Bitcoin’s price movements.
As the trade war intensifies, the US average tariff rate is set to reach levels not seen since the Great Depression, potentially rising above 20%. This doesn’t even account for the possible 100% tariff on BRICS countries. With all this volatility, big opportunities are on the horizon for traders.