Bitcoin’s value experienced a significant decline on Monday, falling nearly 10 percent amid escalating global trade tensions and uncertainty surrounding the proposed US Crypto Strategic Reserve. The cryptocurrency dropped to $85,321.69, erasing gains from earlier in the week.
Market optimism initially surged following an announcement by President Donald Trump outlining plans to establish a US strategic crypto reserve. The reserve would reportedly include major cryptocurrencies such as Bitcoin, Ethereum, Solana’s SOL token, Cardano’s ADA, and XRP. This announcement briefly pushed Bitcoin’s price to a high of $94,834 on Monday. However, the gains were short-lived as investors grew concerned over the lack of detailed information about the reserve and its potential implications.
Adding to market uncertainty, President Trump confirmed the immediate imposition of 25 percent tariffs on all products imported from Mexico and Canada. Both nations have vowed to retaliate, raising fears of an intensifying global trade war. These developments prompted a broader market sell-off, with investors retreating from riskier assets, including cryptocurrencies.
The fallout extended across the cryptocurrency market. Ethereum, the second-largest digital asset, saw its price fall by more than 15 percent, while other major cryptocurrencies such as XRP, Cardano, and Solana suffered declines of nearly 20 percent.
Analysts attribute the sharp downturn to a combination of geopolitical tensions and investor scepticism regarding the proposed crypto reserve. Adam Button, a manager at Forexlive, remarked, “Everything is getting sold. There’s a de-risking that’s unfolding among crypto investors.”
The current environment underscores the heightened volatility and sensitivity of cryptocurrency markets to geopolitical events and policy announcements. As the situation continues to evolve, investors are advised to exercise caution and monitor ongoing developments that could impact market dynamics.
