Bitcoin's $74K Risk: Trump's Tariffs Send Crypto Tumbling
1min read Bitcoin Price Risks Dropping To $74,000 If This Happens
Bitcoin's price has been volatile in recent weeks, with analysts warning that it could drop to $74,000 if certain conditions are met. The cryptocurrency has been affected by a range of factors, including geopolitical tensions and market uncertainty.
One of the main concerns for Bitcoin investors is the impact of U.S. President Donald Trump's tariffs on major trading partners, including Canada, Mexico, and China. These tariffs have sent markets crashing and painted a doubtful picture for crypto markets. Bitcoin slumped below $100,000 on Feb. 2, while altcoins like XRP and Cardano's ADA are down over 17% and 22%, respectively.
The total market liquidation is estimated to be "at least around $8 billion - 10 billion," according to Bybit co-founder and CEO Ben Zhou. Responding to a Cointelegraph post on X, the crypto exchange executive said:
"Bybit's 24hr liquidation alone was $2.1 billion."
On Feb. 1, Trump placed a 25% additional import tariff on Mexico and Canada and 10% on China. Markets went spiraling, with major stock indexes and crypto seeing losses across the board. Trump stated he plans to introduce tariffs on the EU, as well as superconductors, oil, gas, steel, and copper, as soon as Feb. 18.
While many are saying investors should buy the dip, some analysts are noting the increasing correlation between crypto and traditional markets, stating that the incoming tariffs could send Bitcoin tumbling further and increase market uncertainty.
As Bitcoin adoption grows, the role of the asset has changed. Traders, investors, and enthusiasts still debate whether Bitcoin is ultimately a risk-on or risk-off asset. The price of risk-on assets is driven by factors such as earnings, market sentiment, bank policies, and speculation, while risk-off assets serve as safe havens during times of market uncertainty.
With the effect the tariffs have had on crypto markets, many analysts are now firmly in the camp that Bitcoin is — at the moment — a risk-on asset and that further market turbulence will likely negatively affect BTC price.
