Bitcoin and Crypto Markets Hit Hard as Trump’s Tariff Announcement Take Effect

Bitcoin Takes a Hit as Trump Unveils Tariff Plans

The cryptocurrency market faced heavy turbulence this week as President Donald Trump announced sweeping tariff policies that rattled both traditional and digital asset markets. Bitcoin (BTC) initially attempted to defend the $83,000 mark but ultimately tumbled, briefly climbing above $88,000 before retreating back to $82,223. The sharp decline came in the wake of Trump’s “Liberation Day” remarks and the unveiling of reciprocal tariffs on global trade partners.

BTC/USD 2-hours chart - TradingView

Market-Wide Liquidations and Crypto Crash

The fallout from Trump’s announcement was immediate: the total market capitalization of cryptocurrencies plunged by over 5%, falling to a low of $2.64 trillion. Bitcoin saw a 2.5% drop, while Ethereum (ETH) and Solana (SOL) suffered steeper losses of 6% and 6.6%, respectively.

Traders in the crypto derivatives markets were hit hard, with $509 million in liquidations, including $176 million in Bitcoin-focused positions. In total, 181,544 traders saw their positions forcibly closed. Traditional markets also felt the impact, with Dow Jones futures plummeting 918 points and the S&P 500 shedding 3.7%, erasing nearly $2 trillion in market value.

--> Click here to Trade Cryptos with Bitget <--

What’s Behind the Sell-Off?

The catalyst for the sell-off was Trump’s aggressive tariff strategy. His administration introduced a 10% baseline tariff on all imports and a 25% tariff on foreign-made cars. Additionally, reciprocal tariffs, which are set to take effect on April 9, will impose up to 54% tariffs on certain nations, including China.

These protectionist policies created uncertainty across financial markets, prompting investors to move toward safer assets. While Bitcoin often behaves as a hedge against economic instability, its recent price action suggests that investors are currently favoring traditional safe havens like gold, which surged from $3,134 to $3,152 per ounce on the same day.

How Will Bitcoin React Moving Forward?

With Bitcoin stabilizing around $82,000-$84,000, analysts remain divided on what’s next. Some believe this is just a short-term correction, while others argue that further downside risk remains if macroeconomic pressures persist.