Bitcoin, Ethereum, and major cryptocurrencies plunge as US tariff plans fuel recession fears

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Cryptocurrencies, including Bitcoin and Ethereum, are experiencing significant declines due to heightened global risk sentiment following new US tariff announcements by President Trump. Bitcoin fell below $75,000, while Ethereum dropped 18.4%. The market cap of cryptocurrencies shrank by 8.59% to $2.44 trillion, amid fears of a potential recession and speculative interest rate cuts.

Cryptocurrencies, including Bitcoin and Ethereum, are witnessing a downturn on Monday as global risk sentiment soured following new US tariff announcements. The market plummeted after US President Donald Trump made it clear that he would not back down from imposing sweeping import duties, signalling a potential recession and fuelling speculation of an interest rate cut by the Federal Reserve as soon as May.

In a press conference, Trump told reporters that investors would need to “take their medicine” and that he would not negotiate with China until the US trade deficit was addressed. Beijing responded, saying the markets had already spoken on their retaliation plans.

The new tariff regime introduced by the US includes a baseline 10% levy on imports, with significantly higher duties on major Asian trade partners—34% on China, 24% on Japan, 46% on Vietnam, and 25% on South Korea. The European Union is facing a 20% tariff. According to Fitch Ratings, the effective US import tax rate has skyrocketed to 22% under Trump, compared to just 2.5% in 2024, marking its highest level since 1910.

As fears of a global economic slowdown grew, commodities and safe-haven assets also experienced sharp declines.

According to an ET report, Brent crude fell by 6.5%, WTI dropped 7.4%, gold slid 2.4%, and silver plunged 7.3% on concerns over weakening global demand. Meanwhile, the yield on the 10-year US Treasury bond fell by 8 basis points to 3.916% as investors sought out safer assets. Fed funds futures surged, indicating a potential 25-basis-point rate cut by the end of the year.

As of 1:14 PM IST, Bitcoin was trading at $74,993, down 9.72% in the past 24 hours, after touching a low of $74,436. Ethereum also saw a sharp plunge, falling 18.4% to $1,467. The global cryptocurrency market cap dropped 8.59% to $2.44 trillion.

Bitcoin faces “Death Cross” amid recession fears

“Bitcoin has broken below $75,000, signalling concerns that the US economy may be heading into a recession,” said Vikram Subburaj, CEO of Giottus. “Global markets are experiencing a broad sell-off, and this sentiment has spilled over into crypto markets,” added Edul Patel, Co-founder and CEO of Mudrex. He also noted that the upcoming US crypto holdings disclosure could spark a potential relief rally.

Altcoins saw even sharper declines, with XRP down 19%, Solana falling 18%, Dogecoin dropping 20%, and Cardano down 18%. Other altcoins such as BNB, Toncoin, Chainlink, Avalanche, and Shiba Inu saw losses between 11-17%.

Bitcoin’s market capitalization dropped to $1.49 trillion, with its dominance rising to 62.65%. Trading volume surged by 336.5% to $58.54 billion, with stablecoin transactions accounting for 94.16% of the total crypto trading volume, reaching $115.28 billion, according to CoinMarketCap.

“Technical indicators suggest that Bitcoin is nearing a ‘death cross,’ where the 50-day moving average crosses below the 200-day moving average, which could signal further bearish momentum,” Sathvik Vishwanath, Co-Founder & CEO of Unocoin told ET Prime. Analysts are closely monitoring key support levels around $75,000 and resistance near $80,000 to determine potential future price movements.

Disclaimer: The opinions, analyses and recommendations expressed herein are those of brokerage and do not reflect the views of The Times of India. Always consult with a qualified investment advisor or financial planner before making any investment decisions.

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