Trump Tariffs Spark 7% Bitcoin Drop, 7% Ethereum Decline

On July 2, 2025, President Donald Trump's renewed tariff warnings triggered a significant decline in major cryptocurrency prices, sending shockwaves through global markets.
, the leading cryptocurrency, experienced a notable correction as market sentiment turned bearish in response to the announced tariff measures. The uncertainty surrounding U.S. trade policy and the potential impact on global economies contributed to a wave of selling across the crypto market. Bitcoin dropped from nearly $88,000 to $82,000, while decreased from $1,934 to $1,797. Additionally, Bitcoin and altcoins faced downturns, underscoring the potential impact on sector volatility.The tariff threats not only affected the crypto market but also influenced broader market sentiments. Investors became increasingly cautious, leading to a sell-off in various asset classes. The mounting uncertainty over U.S. trade policy and the controversial tax and spending bill further exacerbated the market turmoil. The crypto market, known for its volatility, was particularly sensitive to these developments, with Bitcoin extending its losses as investor sentiment soured.
The impact of Trump's tariff policies extended beyond financial markets, reshaping consumer behavior and online shopping habits. A report indicated that 34% of consumers delayed their purchases, while 28% opted to buy earlier to avoid higher costs. This shift in consumer behavior highlighted the broader economic implications of the tariff measures, which were not limited to financial markets but also affected everyday transactions.
The tariff policies also had a direct impact on specific sectors. For instance, the U.S. announced a 20% tariff on goods from Vietnam and a 40% rate on transshipments, following up on a previous trade deal with the country. This move was part of a broader strategy to address trade imbalances and protect domestic industries, but it also added to the overall uncertainty in global trade.
Despite the market turbulence, nearly half of retail investors (49%) expressed that the Trump Administration had a positive impact on crypto investments. Additionally, 40% of these investors indicated that they were more likely to invest in cryptocurrencies, suggesting that the tariff measures did not deter all investors from the crypto market. This sentiment reflected a broader trend where some investors saw opportunities in the market volatility, while others remained cautious.
The crypto market's reaction to Trump's tariff threats underscored the interconnected nature of global financial markets. The uncertainty surrounding U.S. trade policy and the potential economic fallout from tariff measures created a ripple effect that impacted various asset classes, including cryptocurrencies. As the market navigated through this period of volatility, investors closely monitored developments in trade policy and their potential implications for the broader economy.
The situation influenced financial regulatory bodies, with the SEC convening roundtables for crypto regulatory frameworks. Institutional investors showed cautious stances, affecting decisions within major exchanges and companies. The uncertainty lingers, prompting discussions over economic strategies and regulations, thereby shaping the sector's short-term future. Stakeholders and industry leaders remain alert to navigating these changes, encouraged by historical precedents such as the 2018–2019 trade war impacts. Jonathan Yem, Representative, Kraken, said, "The SEC says it will hold roundtables to develop a regulatory framework for crypto... Both the administration and the SEC’s crypto task force are moving quickly. We believe that acceleration is important for the United States to catch up with other markets that have been well ahead."
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