While Markets Tremble Under Tariffs, Bitcoin Defies Economic Gravity
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While financial markets shuddered under geopolitical pressure, Bitcoin tumbled 7% overnight to $77,077—its lowest point since mid-March. The digital currency, long hailed as a hedge against traditional market chaos, apparently decided to join the panic party. U.S. tariff tensions triggered the plunge, causing ripple effects across the crypto universe.
Ethereum got hit even harder. It dropped to $1,538, scratching lows not seen since October 2023. Talk about a rough day at the digital office. The broader crypto market looked like a sea of red, proving once again that volatility remains crypto's most reliable feature.
Crypto's most faithful companion isn't stability—it's the wild rollercoaster ride that keeps investors reaching for motion sickness pills.
The damage wasn't just theoretical. Real money evaporated as $745 million in long positions got liquidated in just 24 hours. Ouch. That's the highest liquidation tsunami in six weeks, leaving many traders nursing wounds to both their portfolios and their pride.
What's interesting is how this decline mirrored traditional markets. S&P 500 futures dipped while the yen strengthened—typical moves during uncertainty. Banking stocks dropped 16% while payment companies fell 11% in the CE 100 Index. Nobody was safe.
Yet Bitcoin's relationship with conventional markets remains complicated. During COVID-19, Bitcoin collapsed 50% between February and March 2020, making the S&P 500's 33% decline look almost reasonable by comparison. This pattern reflects Bitcoin's increased correlation coefficient with equities observed during major economic downturns.
But then, plot twist! While traditional markets crawled back, Bitcoin rocketed to $60,000+ all-time highs in 2021.
This recent price action reminds investors that Bitcoin remains an enigma. Sometimes it moves with markets, sometimes against them. In 2022, it showed remarkable resilience during macroeconomic chaos, diverging from traditional risk assets when analysts least expected it.
Love it or hate it, Bitcoin continues its unpredictable dance. Investors watching from the sidelines might wonder if they're witnessing a temporary stumble or the start of something bigger.
Either way, Bitcoin's gravity-defying reputation faces another test. And the crypto world watches, breath held. President Trump's pro-crypto comments had previously fueled optimism in the market, making the current tariff-induced decline even more jarring for investors.
