Bitcoin Market Value: After former US President Donald Trump announced new tariffs on Canada, Mexico and China, the cryptocurrency market saw a tremendous decline. Bitcoin fell 7% to $93,768.66, while the CoinDesk 20 index fell by 19%. At the same time, Ether also fell 20% to its lowest level since November.
What is the reason for the decline?
This sharp decline started on Saturday night, when Trump ordered a 25% tariff on Mexico and Canada and a 10% tariff on China. These tariffs will come into effect from Tuesday, which increased uncertainty in global markets. The US has an annual trade of $1.6 trillion with these three countries, due to which this decision can shock the economy of the whole world.
What does this decline mean for bitcoin?
According to Jeff Park, head of Bitwise Asset Management-
“If the tariff war lasts longer, it could be beneficial for bitcoin, as it will weaken the dollar and lead to a drop in US interest rates.”
However, in the short term, bitcoin remains a risky asset and may react negatively to global uncertainties.
Important level for bitcoin
Analysts consider $90,000 as a critical support level for bitcoin. If this level breaks, bitcoin could fall to $80,000.
Bitcoin is down 16% from its all-time high of $109,350.72 on January 20. However, experienced crypto investors consider corrections of up to 30% to be normal during a bull market.
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