Crypto Market Cap Drops 4.06% Amid Tariff Announcements

On April 8, 2025, the cryptocurrency market experienced a significant downturn, with the global market cap declining by 4.06% to $2.53 trillion. This decline was accompanied by a surge in intraday trading volume, which increased by over 60% to $192.78 billion, indicating heightened market activity despite the bearish sentiment. The Fear & Greed Index plummeted to 19, signaling extreme fear among investors.

Bitcoin demonstrated resilience amidst the market turmoil, holding firm near the $80,000 mark. This stability came after a period of volatility where Bitcoin had dropped to a four-month low of $74,500 on April 7, 2025. The cryptocurrency's recovery to approximately $80,147 represented a 3.4% gain over the past 24 hours, defying the broader bearish trends. The recent market volatility was triggered by various factors, including US tariff announcements and broader economic uncertainties, leading to significant price corrections across the crypto market. Bitcoin experienced a decline from $82,000 to $76,000, with long-term holders beginning to move their coins, indicating potential selling intent due to market volatility. This trend was reflected in the Exchange Inflow Coin Days Destroying (CDD) statistic, which gauged the movement of older, inactive coins. The spike in this signal suggested that experienced holders were preparing to sell assets in response to market uncertainties.

Corporate Bitcoin holders also felt the pressure of the market volatility. Following President Trump’s tariff statements, corporate Bitcoin holdings lost over $4 billion in value, dropping from around $59 billion to nearly $54.5 billion by April 7, 2025. MicroStrategy, known for its significant Bitcoin holdings, saw its shares drop by more than 13% since April 2, 2025. The company briefly halted its Bitcoin buying program between March 31 and April 6, 2025, indicating nervousness even among the most dedicated institutional Bitcoin holders.

Despite the challenges, Bitcoin showed signs of resilience against traditional financial markets. While most US stock indices fell by more than 10% after the tariff declarations, Bitcoin recovered faster. This behavior suggested that Bitcoin might be starting to establish a more independent macro identity, enhancing its narrative as a store of value separate from conventional financial markets. The correlation between Bitcoin and gold remained low at 0.12 over the previous 90 days, while its correlation with stocks was at 0.32. However, gold remained the most sought-after safe-haven asset among fund managers, with 58% of respondents preferring it over Bitcoin in trade war conditions.

Ethereum also faced significant challenges, with its price plummeting by more than 12% in the last 24 hours. The cryptocurrency saw an intense plunge, down around $1,600 per token, its lowest point since late 2023. Despite these setbacks, both Bitcoin and Ethereum managed to hold onto their gains, demonstrating their ability to withstand market turbulence. The performance of these cryptocurrencies in the coming weeks will be crucial in determining their role as reliable hedges against economic instability as global markets continue to adjust to the possibility of extended trade fragmentation and geopolitical tensions.

Among the top gainers, FARTCOIN led the pack with a remarkable 30% rally, followed by HYPE and HBAR with gains of 18.54% and 16.63%, respectively. On the losing side, PAXG and XAUt slipped slightly, reflecting broader hesitation around traditional hedges. Solana emerged as a standout performer among majors, rallying more than 8%. XRP also impressed investors with a near 5% daily surge, signaling renewed interest from the community.