Bitcoin price dips under $65,000 after Trump fires fresh trade war volley

Bitcoin’s price fell 3% on Monday to just under $65,000 after $434 million in long positions were liquidated amid fresh market uncertainty.

The losses followed signals from White House officials on Sunday that indicated that previously negotiated trade agreements would remain intact, despite a Supreme Court decision invalidating US President Donald Trump’s use of emergency powers to impose global tariffs.

In a social media post on Saturday, Trump said he’d raise the global tariff rate from 10% to 15%, just a day after announcing the initial measure, riling up the market whiplash. The dollar weakened further while US stock futures slipped in early Monday trading, with S&P 500 contracts down nearly 1%.

Bitcoin’s price drop extends a near 50% freefall from its $126,000 peak. The top crypto’s plunge comes as $2 trillion in crypto industry value has been wiped out since October.

Trump’s Sunday tariff volley “dispels the notion that Trump might’ve lost the taste for trade-warring,” Ed Yardeni, president of Yardeni research, said. “Where Trump takes tariffs now is anyone’s guess.”

The new tariff threats come ahead of Trump’s State of the Union national address scheduled for Tuesday.

More headwinds

Trump’s trade war isn’t the only thing clouding markets. Several geopolitical flashpoints weigh on investors’ sentiment.

Energy traders are on alert as the US assembles its largest concentration of naval assets and weapons systems in the Middle East since the early 2000s, while Trump signals potential action against Tehran.

Analysts told DL News that another Middle Eastern conflict could prompt investors to further derisk, potentially bringing more pain to crypto investors.

Domestically, the outlook for Federal Reserve policy has grown more complex.

Minutes from the January Federal Open Market Committee meeting suggested some officials see the next move potentially being a rate increase rather than a cut, Yardeni said.

That backdrop is likely to sharpen focus on this week’s appearances by a slew of Fed officials. Governor Christopher Waller is due to speak on the economic outlook on Monday and technological disruption on Tuesday, while Governor Lisa Cook will address artificial intelligence and productivity.

For investors concerned about the AI bubble, Nvidia’s fourth-quarter earnings on Wednesday will be watched as a proxy for broader economic momentum, alongside the official data releases scheduled this week.

It is against this backdrop that Google searches for “is Bitcoin dead” have surged in recent months as traders are losing confidence in crypto.

Yet, despite the pressure on the market, perennial pumpers like Arthur Hayes, Tom Lee and Michael Saylor — the last two of which have seen their digital asset treasury firms take on brutal beatings from the market — continue to sing the praises of the top cryptocurrencies.

The way they put it through blog posts, public appearances and through press releases, it is only a matter of time before Bitcoin and the rest of the crypto market returns to former glories — or even exceeds them.

Crypto market movers

• Bitcoin is down 3.4% over the past 24 hours, trading at $65,731.
• Ethereum is down 4.5% past 24 hours at $1,883.

What we’re reading

• Prediction markets are bending insider trading rules. But will they break them? — DL News
• Bitcoin price will hit a new record as AI destroys jobs, Arthur Hayes says — DL News
• Why AI Investments Could Go Bust and Which Stocks May Be More Solid Winners — Unchained
• Crypto’s Biggest Setup Is Happening Right Now w/ Kyle Reidhead — Milk Road
• Prosecutors recover $22 million worth of lost Bitcoin — DL News

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.