Preface

Early Wednesday, Bitcoin saw a decline approaching $75,000 before making a slight recovery. This followed the commencement of sweeping global tariffs initiated by Trump. Ether also fell by 10%, leading a decline in major tokens as market impacts spread. The market’s overall capitalization decreased by 6%, intensifying a week-long loss nearing 15%.

Lazy bag

The market is facing significant challenges with major tokens plunging due to new tariffs. The crypto market's outlook sees potential recovery tied to market stability and policy shifts.

Main Body

The cryptocurrency market faced substantial turbulence as Bitcoin slipped below $75,000 on Wednesday, a consequence of President Trump's broad-sweeping tariffs which took effect globally. Ethereum led a 10% drop among leading cryptocurrencies, with Ripple’s XRP, Dogecoin, and others falling by over 5%. Over the past week, the market saw a cumulative decline of nearly 15%, further eroding confidence among investors.

Amid these upheavals, smaller and trendy tokens like Berachain's BERA also experienced a 20% reduction, while popular meme coins like BONK, PEPE, and FLOKI dropped by over 9%. The decline represents a continued retreat from major cryptocurrencies, erasing any gains from a prior relief rally, as Trump's policy further threatens the global trade climate.

U.S. Treasuries faced a sell-off, with 30-year yields spiking more than 20 basis points to 4.98%, diverging from their typical safe haven status, creating concern among investors. Speculation arose about forced liquidations among major players, echoing historical surges last seen in the early 1980s, a cause for anxiety in the financial community.

Market observers are cautioned about the alarming yield increase, suggesting a 'basis trade' is perhaps unwinding disorderly, with bond prices falling and borrowing costs for the U.S. government increasing, further straining the federal deficit amidst high debt levels.

Investor concerns are multifaceted, including potential disruptions to global trade, supply chain interference, and overall impacts on U.S. growth. Bitcoin’s trend typically mirrors these shifts, facing further downward pressure potentially to the $70,000 mark if trade tensions intensify.

Analysts like Ryan Lee of Bitget Research advise cautious investment strategies, seeing promise in dollar-cost averaging into Bitcoin and spotlighting Solana for potential high-risk upside as conditions stabilize. An optimistic future could see Bitcoin challenge $95,000–$100,000 by 2025, contingent on market stabilization and pro-crypto policy developments.

Key Insights Table