TLDR:
- Bitcoin fell 0.8% to $83,421.50 following Trump’s announcement of a 10% universal tariff
- Trump introduced reciprocal tariffs targeting specific countries, with China facing a combined 54% tariff
- The tariff policy takes effect April 5, 2025, with reciprocal tariffs starting April 9, 2025
- Crypto-related stocks tumbled in extended trading (Coinbase -7.5%, Marathon Digital -7.3%, Riot -7%)
- Markets moved toward safe-haven assets, with gold trading at record highs
Bitcoin’s price dropped as global markets reacted to President Donald Trump’s sweeping tariff announcements. The cryptocurrency, which has sometimes been called “digital gold,” fell to $83,421.50, showing a 0.8% decline as of 01:32 ET on Thursday.
The drop comes after President Trump announced a major overhaul of U.S. trade policy. Starting April 5, 2025, all imported goods will face a 10% universal tariff.
But that’s not all. Trump also revealed plans for reciprocal tariffs targeting specific nations with trade barriers against U.S. products. These additional tariffs will take effect on April 9, 2025.
The reciprocal tariffs are set at approximately half the rates those countries impose on U.S. exports. China will now face a combined tariff of 54%, including a new 34% surcharge.
Other countries will also see increased tariffs. Japan faces 24%, the European Union 20%, India 26%, and Vietnam 46%.
Trade War Concerns
The comprehensive nature of these tariffs has raised fears of a global trade war. This concern triggered a risk-off mood across financial markets worldwide.
Major U.S. stock index futures saw sharp drops in early Asian trading hours on Thursday. Most Asian stock indices also tumbled as investors processed the news.
Bitcoin’s reaction shows its continued connection to broader market sentiment. While sometimes promoted as a hedge against economic uncertainty, the cryptocurrency’s recent price movement suggests it remains tied to overall risk appetite.
During periods of market stress, investors typically move away from volatile assets like cryptocurrencies. They tend to favor traditional safe-haven assets such as gold, which was trading at record highs in Asian trading.
Crypto Stocks Feel the Pressure
The impact extended beyond Bitcoin itself. Crypto-related stocks saw substantial declines in extended trading on Wednesday.
Coinbase Global Inc (NASDAQ) shares dropped 7.5% after the bell. Major Bitcoin miners also felt the pressure.
Marathon Digital (NASDAQ) slid 7.3%, while Riot Platforms (NASDAQ) fell 7% in extended trading.
Strategy, formerly known as MicroStrategy Incorporated (NASDAQ), saw its shares drop 4.6% following the tariff announcement.
These stock movements highlight how closely the cryptocurrency sector is now tied to the broader financial ecosystem. Policy changes that impact traditional markets now regularly influence crypto assets as well.
Trump’s automotive sector tariffs will add further pressure to markets. A 25% tariff on foreign-made automobiles and key auto parts is set to take effect on April 3, 2025.
The combination of these various tariff measures has created uncertainty across multiple market sectors, with cryptocurrencies showing their sensitivity to these macroeconomic shifts.
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