Why Is Crypto Crashing? Trump Tariffs & Trade War Impact Markets

By / / Crypto News, Daily News
Why Is Crypto Crashing? Trump Tariffs & Trade War Impact Markets
Table Of Contents
  1. Trump Tariffs Shake Global Markets – Is Crypto Next?
  2. Was Trump’s Crypto Reserve Announcement a Market Trap?
  3. Fear and Greed Index Hits Extreme Fear
  4. Crypto Market Performance Today
  5. Will Crypto Recover or Crash Further?

The cryptocurrency market has taken a major hit, with the total market cap plummeting to $2.77 trillion, marking an 8.64% drop in just 24 hours. This sharp decline follows Trump’s latest trade war escalation and new tariff policies, triggering uncertainty across both traditional and digital asset markets.

Trump Tariffs Shake Global Markets – Is Crypto Next?

One of the biggest reasons behind today’s crypto crash is the escalation of Trump’s trade war. The U.S. recently increased tariffs on Chinese imports from 10% to 20% and imposed a 25% tariff on Canada and Mexico. In response, China retaliated with tariffs of up to 15% on U.S. agricultural products, intensifying fears of a broader economic slowdown.

This uncertainty has spilled into the stock market, with the S&P 500 wiping out $1.5 trillion in a single day, according to The Kobeissi Letter. Between 10:00 AM and 3:30 PM ET, Wall Street experienced significant losses, forcing investors to reassess their positions.

Was Trump’s Crypto Reserve Announcement a Market Trap?

Adding to the volatility, Trump recently announced plans for a U.S. Crypto Reserve that would prioritize Bitcoin (BTC), Ethereum (ETH), Solana (SOL), XRP, and Cardano (ADA). This initially fueled a 4.41% market surge, pushing the total market cap to $2.79 trillion on March 3. However, the excitement was short-lived, with crypto prices crashing 8.64% the next day, raising speculation about whether this was a pump-and-dump scenario orchestrated by major players.

While there is no solid proof of market manipulation, the sudden reversal has left many investors skeptical.

Fear and Greed Index Hits Extreme Fear

The Fear and Greed Index, a key sentiment tracker, has plunged from Fear (33) to Extreme Fear (15) in just 24 hours. Just a month ago, the market was in Greed mode (60), signaling optimism. Now, panic is spreading as uncertainty looms.

Historically, Extreme Fear signals potential buying opportunities for long-term investors. Conversely, when the index reaches Greed, markets often correct—something traders are keeping a close eye on.

Crypto Market Performance Today

  • Bitcoin (BTC) – $83,929.75 (-9.34%), Market Cap: $1.66T, 24H Volume: $73.61B
  • Ethereum (ETH) – $2,103.51 (-10.49%), Market Cap: $253.56B
  • Cardano (ADA) – $0.8258 (-14%), Market Cap: $29.07B

Will Crypto Recover or Crash Further?

Two key events could determine whether the market rebounds or declines further:

  1. White House Crypto Summit – March 7: President Trump is hosting a high-profile crypto summit featuring executives from Coinbase, Binance.US, and Andreessen Horowitz. If the summit results in a clear regulatory framework, investor confidence could be restored.
  2. New Spot ETF Approvals: The approval of spot XRP, Cardano, Polkadot, Dogecoin, and Litecoin ETFs could drive fresh institutional investment, setting the stage for a potential market rebound.

For now, crypto remains highly volatile, and investors are treading cautiously. Will Trump’s trade war deepen the crash, or is this the perfect dip-buying opportunity before the next bull run?

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