On Sunday, Bitcoin experienced a drop of over 2% as digital currencies struggled to maintain stability amidst fluctuating trade policy signals from Washington regarding China.
During Asian trading hours, the price of the leading cryptocurrency fell to $83,482, partially reversing last week’s gains and lagging behind equity markets.
Ethereum, the second-largest cryptocurrency, dropped below $1,600, while the performance of altcoins varied, as reported by CoinGecko.
This decline came after a weekend filled with mixed signals from the Trump administration regarding the potential implementation of new tariffs on electronics made in China—such as smartphones, semiconductors, and laptops.
On Sunday evening, President Trump took to Truth Social to clarify that, while some electronics were temporarily excluded from the new 10% “reciprocal” tariffs, they would still face a separate 20% levy due to national security and opioid enforcement issues.
“NOBODY is getting ‘off the hook’ for the unfair trade dynamics and non-monetary tariff barriers other nations have used against us, especially not China, which treats us the worst!” Trump stated. “No tariff ‘exception’ was announced on Friday.”
Commerce Secretary Howard Lutnick indicated this weekend that additional sector-specific tariffs on electronics might be implemented within the next two months.
Equity markets seemed to find some relief in the temporary exemptions.
Nasdaq 100 futures surged over 1% in early trading, while S&P 500 futures increased by 0.7%. However, cryptocurrencies displayed minimal resilience.
This recent price movement marks a shift from the relative stability observed earlier in the week, where traders anticipated a potential rise following encouraging signals indicating that inflation was beginning to decline.
However, this narrative has been complicated by a resurgence of geopolitical tensions along with signs of diminishing institutional investment in U.S.-listed crypto ETFs.
“Expectations for an emergency rate cut ahead of the next Fed meeting in May have weakened, as the medium-term inflationary impact of Trump administration tariffs is likely to delay Powell from making cuts until after June,” stated Darren Chu, consulting analyst at BRN, in a comment to Decrypt.
This indicates that a prolonged higher rate environment may further challenge risk assets, as investors navigate the Fed’s hawkish tendencies.
Analysts are now monitoring crucial levels around $81,000 for Bitcoin as a potential support point. Falling below this threshold could trigger liquidations across leveraged positions, thereby intensifying the pressure on an already vulnerable market.
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