Bitcoin’s price was at $85,000 at the time of this writing, while ETH fell to $2,000. The rapid reversal of over $10,000 in gains within hours has triggered turmoil among altcoins. Even those who have witnessed multiple cycles and have been in the crypto space for over a decade are unable to hide their anxiety in the ongoing situation. What is really happening? Why is Bitcoin 
$64,643 dropping?
Reasons Behind Bitcoin’s Decline
We previously discussed the potential disruption in Bitcoin’s positive correlation with Nasdaq, especially with its current stagnation. Many experts predicted that if U.S. stock markets fell, this correlation could revert. As it turned out, the recent drop in U.S. markets has contributed to Bitcoin’s losses.
Today, Trump implemented tariffs for Canada and Mexico, pushing the Nasdaq Composite into correction territory and causing a 10% drop since its December peak. The S&P 500 fell by 1.3%, reaching its lowest levels since the elections on November 5. The morning session for Asian markets was also grim.
Trump’s Tariff Strategy Affects Markets
With Citigroup shares down 6.7%, Bank of America down 6%, and JPMorgan Chase down 4%, the finance sector experienced one of its worst periods, declining by 3.2%. Many did not anticipate Trump’s tariffs to be enforced and expected them to be used as leverage during negotiations. However, he applied a 20% tariff on China and 25% on other countries today, with new announcements expected later.
Trump made a stark statement regarding tariffs as leverage, saying they will continue to rise “as long as they retaliate” (referring to Canada), highlighting the severity of the situation. Max Wasserman, co-founder and senior portfolio manager at Miramar Capital, mentioned, “People are waking up and thinking, wait, this is a big deal. This will be implemented.”
Amid all this chaos, the possibility of interest rate cuts has diminished to May.
