- The new American prices on China, Mexico and Canada trigger geopolitical tensions, which has caused commercial reprisal restrictions.
- Vix reached 54%, reporting increased fear of the market and a feeling of risk among investors.
The cryptocurrency market has made a sudden dive today, Bitcoin (BTC) slipped to around $ 83,591 and to lose most of the earnings he made after Donald Trump announced plans for a reserve of American strategic cryptography.
This slowdown took place when the financial markets reacted to increased geopolitical tensions, newly imposed US sales prices and China’s reprisal measures against American companies.
Disturbed price: was an accident inevitable?
Trump’s suggestion of an American crypto reserve had initially sent Bitcoin Ride over $ 95,000, fueled by optimism that official support would strengthen the sector.
In addition, announcements have been made to plans To build five semiconductor installations in Arizona, increase the total investment of the United States of TSMC to $ 165 billion and generate “hundreds of billions of dollars” in economic activity.
Investors considered this to be a signal for supporting the strong government for the technology and cryptography sectors, pushing the prices of Bitcoin.
This optimism has faded once the White House announcement New prices on China, Mexico and Canada, increasing regulatory uncertainty and aggravating global economic prospects.
When Trump confirmed a 25% rate on Canadian and Mexican products, Canadian Prime Minister Justin Trudeau promised an energetic response, and Canada quickly retaliated with a 25% tax on around $ 100 billion in American imports.
Trudeau published a strong statement, claiming,
“Canada will not let this unjustified decision remain unanswered.”
On March 4, China added 15 American companies to its export control list, limiting the flow of critical technologies to these companies and reporting a new series of commercial friction.
How bad is it?
Anxiety of investors on these policies corrugated through stock markets. On March 3, the S&P 500 lost 1.8%, while the NASDAQ flowed 9% compared to its December summit.
The Dow Jones briefly dropped 1,100 points after earning 300 points earlier during the day.
Consumer technology and stocks face to face The heaviest losses, Nvidia slipping 9.46%, Broadcom losing almost 6%and Microsoft down 2.41%. Amazon and Tesla also dropped by more than 3%.
Source: Finviz
During this turmoil, the volatility index (VIX) – often called the “fear gauge” – jumped 54% since mid -February, reflecting a deep concern about the impact of trade policy and regulatory changes.
Unsurprisingly, the slide of the actions spread in cryptocurrencies while traders reduced exposure to risky assets.
Source: tradingView
Trump’s March 2 announcement that the planned US Crypto Strategic Reserve Including Bitcoin, Ethereum (ETH) and several altcoins initially sparked a thrust of digital assets.
Bitcoin ran up to $ 95,000 before the steam rally, plunging $ 86,334.49 on Monday, a drop of 8.31% compared to its weekend peak.
Source: tradingView
Ethereum, who had also gained momentum, reversed the course and displayed a drop of 14.88%.
The growing fears of economic slowdown have further added pressure. The GDPNOW of the Atlanta Federal Reserve forecast For the first quarter of 2025, decreased considerably by + 3.9% to -2.8% in just one month.
This drastic drop indicates an aggravation of economic perspectives.
Source: X
Due to negative economic forecasts, investors are looking for safer investments, such as the bonds of the Treasury at 10 years. This increased demand reduced the yield of the treasury to 10 years to 4.178%.
The combination of fears of economic slowdown and the significant decrease in GDP forecasts have created uncertainty on the market and led investors to seek safer assets.
Upon surge, flowing now
On March 4, during the press, Bitcoin slipped to $ 83,925.46, ending his recent recovery. Exchange Netflows, Bitcoin metric monitoring transfers in and outside the trading platforms, has highlighted a change in traffic behavior.
Source: cryptocurrency
From March 2 to March 3, outings of more than 2,000 BTC on each day suggested an accumulation by long -term holders.
However, Netflows became positive on March 4, indicating that some investors returned Bitcoin to exchanges, possibly to lock the profits or protect themselves from other price cuts.
Source: cryptocurrency
The production ratio of production spent by cryptocurrency (SOPR) supported this trend, going from 1,0106 on March 2 to 0.994 on March 4.
This change implies that the traders who had obtained the brief rally were now emerging from posts below their initial entry points.
What do merchants feel?
The feeling of the market has deteriorated quickly and the index of fear and greed increased to 15. This reflects an “extreme fear” comparable to previous market accidents. In these accidents, leverage and panic positions selling in -depth losses.
Linen data watch that 297,653 traders have been liquidated in the last 24 hours, which resulted in $ 1.01 billion in liquidations. The most important of them was a liquidation of $ 13.4 million on Bitfinex.
Source: Coringlass
The turmoil has also drawn the attention of political observers.
Ki Young Ju, CEO of Cryptochant, describe How the American government seems to treat cryptocurrency as a geopolitical instrument,
“The cryptography market is becoming more and more a weapon in the United States. Since the election of Trump, universal moral standards have decreased. Now, if something benefits Trump and serves American national interests, he is no longer considered illegal. »»
Where are we going from here?
Overall, the slowdown in the cryptography market can be attributed to several intertwined factors: geopolitical uncertainty, massive liquidations and the feeling of rapidly evolving investors.
The introduction of new prices on China, Mexico and Canada sparked a drop in stock markets and has educated digital assets.
The Fear & Greed index located at 15 and liquidations exceeding $ 1 billion, the environment remains heavy.
While Bitcoin oscillates about $ 83,400, traders look closely to see if the market finds a stable sole or heads for deeper collapse.
The next few days will be essential to determine whether this withdrawal is a brief correction or the start of a prolonged slowdown.
