Trump Tariffs Spark Crypto Market Panic, Bitcoin Plunges Below $92,000

Bitcoin Plunges Below $92,000 as Trump Tariffs Spark Market Panic

Bitcoin (BTC) and the broader crypto market experienced a significant sell-off on Monday, February 1, as investors reacted to U.S. President Donald Trump's decision to impose tariffs on imports from Canada, Mexico, and China. The flagship cryptocurrency fell below the $92,000 level, marking a sharp reversal from the optimism surrounding Trump's pro-crypto rhetoric and election victory.

Analysts and market participants attributed the sell-off to concerns about a potential trade war and its impact on global markets. Caroline Bowler, CEO of BTC Markets, stated, "Trump's tariff war is impacting the whole market. Concerns about trade wars and stagflation, triggering recessions, are cascading across altcoins and Bitcoin."

BTC Markets CEO Caroline Bowler's comments reflect the broader market sentiment, as investors flee high-risk assets, including Bitcoin and other cryptocurrencies. The U.S. Dollar Index (DXY) reached its highest point since January 13, indicating a shift away from riskier assets and towards safe-haven currencies.

The crypto market's combined market cap fell by as much as 21% over three days, totaling a reduction of $760 billion. This decline was accompanied by a significant increase in market volatility, with BTC's 30-day implied volatility rising by 4% to 54% in the wake of the tariffs and broader economic uncertainty.

MicroStrategy, a company known for its aggressive Bitcoin buying strategy, saw its stock price drop over 5% during premarket hours. The company recently added over 10,000 BTC to its holdings, taking its total to 471,107 BTC.

Bitcoin's price action has been volatile in recent sessions, with the cryptocurrency dropping to an intraday low of $97,766 on Monday before recovering to reclaim $100,000. Buyers attempted a recovery on Tuesday, with BTC reaching an intraday high of $103,295. However, it lost momentum after reaching this level and dropped 0.69% to $101,262. Buyers returned to the