Crypto crashes as tariff war fears mount: BTC plunges below $75K, over $160B wiped out

Mirroring the disruptions caused in equity markets across the world, including India, the crypto market is also experiencing brutal sell-offs, with Bitcoin (BTC) prices falling below $75,000 after shedding around 10% over the past 24 hours, while other cryptocurrencies also experienced similar losses. The sudden plunge of Bitcoin below the $80,000 threshold and overall crypto market selloff erased over $160 billion in value amid macroeconomic uncertainty and investor wariness. 

Extreme sell-offs in all major crypto coins were fuelled as investors remained worried over the economic implications of the newly imposed tariffs by the US on major economies across the world. "Major crypto mirrored this downward trend, where Ethereum declined nearly 13%, followed by Solana and Ripple declining over 12% in the last 24 hours, reflecting broader market uncertainties," homegrown crypto platform CoinSwitch said in its latest market commentary. 

Crypto platform CoinDesk said its broad-based CoinDesk 20 (CD20) index, which tracks the largest tokens, slumped 12%, signalling a major negative sentiment gripping the sector.

Other major altcoins like Ethereum, XRP, Cardano, and a few more also faced acute bearish action, erasing tens of billions of dollars from their market caps. While SOL also nosedived more than 20% but sustained strongly above $100 (currently down 12.49% at $101.89), ether (ETH) plunged 22%. XRP and DOGE also plunged 20% and 15%, respectively. 

Most of the cryptos are facing double-digit losses, "hinting at the beginning of a bear market", a commentary by crypto exchange CoinDCX stated.

Despite major crashes in equity as well as digital assets markets, US President Donald Trump remained confident of a ‘booming market", and asserted the tariffs were for the betterment of America. 

Avinash Shekhar, Co-Founder & CEO, Pi42, says incessant pressure emanating from worldwide financial anxiety and short-term sales may continue to challenge Bitcoin's backbone as well as the overall marketplace's stability. "As futures on Wall Street dipped and 'Black Monday' repeat fears emerged, the coupling between traditional markets and crypto holdings became more visible. Bitcoin's decline and furious weekend losses show bearish force in the offing, as market players are closely watching cap trajectories for signs of what's ahead. Through such turbulence, some of the altcoins, such as Pi, OKB, GT, and ATOM, may find reason to outgain," says Shekhar.

Michael Saylor, founder of Strategy, which holds around 5,28,185 BTCs worth $40.86 billion, expressed optimism amid the extreme market volatility, saying the lower Bitcoin goes, the more eager he is to stack. "The masses will treat Bitcoin like prime real estate—buy it and hold it. But here’s the catch: you can always build more houses, yet there will only ever be 21 million BTC. And each year, fewer are up for grabs," he said in a follow-up post on X.

In retaliation for US President Donald Trump's tariff war, China on Friday last week announced 34% additional tariffs on all goods imported from the United States. The move came after Trump slapped an additional 34% tariffs on Chinese goods, escalating a tariff war between the two largest economies in the world. Trump also imposed 25% tariffs on imports from Canada and Mexico, sparking fears of retaliatory tariffs from various countries.

Global stock markets plunged amid escalating U.S.-China trade tensions, with the Nasdaq down nearly 25% from peak to trough and Chinese stocks falling around 9%. The latest sell-off was triggered by China’s retaliatory measures (e.g. a new 34% tariff on all U.S. imports), which wiped out over $5 trillion from U.S. equities in just a few days. "Investors rushed to safe-haven assets: US treasury yields plummeted, Japanese government bond (JGB) yields dropped around 20 basis points, and markets are now pricing in 4 to 5 Fed rate cuts by year-end, despite official resistance," SignalPlus, a crypto options, spot and futures trading platform, in its weekly market commentary. 

The UK and German stocks also dropped over 4%, the Taiwan stock index by 9.8%, and the China stock market plunged 10% on opening on Monday. JP Morgan has increased the probability of a global recession in 2025 to 40%, and Jim Cramer predicted another 20% crash, much similar to the 1987 collapse known as Black Monday. However, billionaire Mark Cuban advised investors not to sell as the markets tend to recover while the timeline remains unrestricted.