Global Markets Plunge 13% on Trump Tariffs, Bitcoin Drops 7.7%

On April 7, 2025, global stock and crypto markets experienced a significant crash, dubbed "Black Monday" by the media. This event was reminiscent of previous market collapses, such as Black Thursday of 2020 and Black Monday of 1987. The crash was triggered by the Trump Administration's trade war and imposition of tariffs on numerous countries, which began on April 2, 2025. The markets started to shake and eventually plummeted on the morning of April 7, as there were no signs of a change in the administration's stance. Experts warned about the potential for a recession.

The crypto market was particularly hard hit. Bitcoin lost around 7.7% in 24 hours, while other top cryptocurrencies saw even steeper declines. Ether, Solana, and XRP lost around 20%, and BNB saw a 9% decline. The prices retraced by 3 to 5%, and around $600 million in leveraged crypto positions were liquidated within 24 hours. The U.S. stock market closed with relatively small price drops, opening down around 3% but recovering by the end of the day. The day closed with a slight decline of under 1%. The Nasdaq saw the highest single-day amplitude since 2008.

In several countries, the stock market experienced significant declines. The benchmark Heng Seng index in Hong Kong saw a 13% decline, the biggest single-day drop since 1997. Japan’s benchmark Nikkei index closed at a 7.9% decline. Chinese markets closed at a better rate. The 30% tariffs against South Africa resulted in a 9% drop in the local market. Australian markets closed down 4.2%, the biggest fall since 2020. European markets opened down 5 to 9% but closed “only” 4.7% lower, the worst result since March 2022 when markets closed 4.9% down.

The effects of the market crash varied by country, and the market crash may continue as the main factors behind it, including the trade war and aggressive rhetoric towards Canada and Greenland, persist. The April 7 Bitcoin crash was not the worst single-day price drop in history. The most significant drop occurred on March 12, 2020, when Bitcoin saw a 50% drop following the World Health Organization's declaration of COVID-19 as a pandemic. The world stock market was in a panic, and traders needed cash, so they were selling everything they had, including crypto. The BTC price began to rise 24 hours after the crash, regaining over half of its value and fully recovering by the end of April. The stimulus payments handed by the government in 2020 and 2021 played a crucial role in the recovery of the crypto market. Nearly 10% of Americans used stimulus payments to invest in crypto, helping the market to recover quickly.

Other significant downfalls in Bitcoin prices include the April 2013 suspension of operations by Mt Gox, an exchange responsible for 70% of crypto trading at that time. The BTC price fell from $100 to $55 but recovered to above $130 by the end of April. The FTX exchange collapse in November 2022 caused a single-day 15% drop in the Bitcoin price when it dropped from $18.5k to $15.7k. It took a couple of months for the market to fully recover from the decline, with whales like Tim Draper and Michael Saylor making a series of BTC purchases.

Looking ahead, the founder of MN Consultancy, Michael van de Poppe, believes that Liberation Day marked the climax of uncertainty. He predicts that the big players will soon understand the changing conditions, and the market will start recovering. Poppe's opinion is that the tariffs may stay in effect from 6 to 12 months. However, several days into the crisis, countries are still exchanging threats and demands, suggesting that the uncertainty climax may take longer. In the past, Bitcoin has shown its ability to rebound during economic turmoil, and hopefully, this time will be no different.