Bitcoin Struggles Amid Trade War Fears, Market Uncertainty Grows

After “Black Monday,” the crypto markets are not calm. Bitcoin is still trading below $100,000, Ethereum well below $3,000. Possible US punitive tariffs are considered to be the reason for the setbacks.

The new US President Donald Trump is risking a trade war with China through punitive tariffs and the crypto markets are reacting sensitively. The ” Black Monday ” at the beginning of the week had massively set Bitcoin and Co. back.

The situation only calmed down when Trump temporarily suspended punitive tariffs against neighboring countries Mexico and Canada. But China has now imposed punitive tariffs of up to 15 percent on US imports and Bitcoin has suffered a daily loss of almost 2 percent. Leading altcoins such as Ethereum and XRP (Ripple) are also lagging behind the losses that have accumulated in recent days.

Concerns about the impact of Trump’s economic policy are also reaching Europe. Although the US president has not yet announced any concrete measures with regard to the EU, Brussels has been warned. Trump has announced that he will be dealing with Europe shortly.

Bitcoin’s price curve is reacting nervously, as are global stock markets. In a negative scenario, aggressive US trade policy could fuel inflation again, experts fear. As long as there is a risk of inflation, Bitcoin will trade sideways, say analysts at Standard Chartered Bank. However, the bank has not yet revised its forecast that Bitcoin will reach the record level of $200,000 by the end of the year.

Bitcoin price developments can provide entry opportunities

Optimists see the current prices of Bitcoin, Ethereum and other cryptocurrencies as an opportunity for investment. At least the Bitcoin ETFs are still in good health and recorded a good $340 million in capital inflows yesterday, as data from SoSo shows.

The fact that the “digital gold” Bitcoin has the reputation of being a hedge against inflation seems to be paying off here. In addition, a state Bitcoin reserve in the USA is still being discussed; Trump had suggested it during the election campaign.

Conclusion: Uncertainties in the global economy are putting pressure on Bitcoin

The crypto rally that began after Trump’s election victory appears to have stopped for the time being. But Bitcoin and Co. are still trading at levels that are up to twice as high as they were three months ago , when US voters chose Trump.

Only the illusion that Bitcoin can decouple from global economic trends is fading. It is still unclear whether Trump will be dissuaded from using punitive tariffs to enforce his ideas on foreign trade. The resulting uncertainties are palpable for Bitcoin and the crypto markets.

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(Featured image by Crypto Crow via Pexels)

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