Bitcoin Drops 6% After Trump Signs Tariff Order, Faces 20% Chance of Falling to $72K

The decline began on Saturday night after Trump enacted a 25% tariff on imports from Mexico and Canada and a 10% tariff on Chinese goods

U.S. President Donald Trump's new tariffs on Canada and Mexico, with possible measures against the European Union also on the horizon, have sparked a sharp decline in the price of Bitcoin (CRYPTO: BTC).

According to CoinMarketCap, the apex cryptocurrency dropped from $100,000 to around $93,000 by 9:00 a.m. (GMT+3), wiping out roughly $130 billion from its market capitalization.

The decline began on Saturday night after Trump enacted a 25% tariff on imports from Mexico and Canada and a 10% tariff on Chinese goods, set to take effect on Tuesday. The U.S. has a trade volume of approximately $1.6 trillion with these three countries.

Other major cryptocurrencies also saw steep declines on Monday. Ethereum (CRYPTO: ETH) plunged over 20% to $2,500 and Solana (CRYPTO: SOL) fell by 7.5% to $195.

According to U.S.-based cryptocurrency platform Derive.xyz, the probability of Bitcoin sliding to $75,000 by Mar. 28 has surged from 10% to 22%.

“The recent tariffs imposed by Trump — including 25% on imports from Mexico and Canada and 10% on Chinese goods — are likely to lead to increased inflation, which could dampen investor sentiment in crypto markets,” Derive stated in an e-mail message.

El Salvador, meanwhile, has officially revoked Bitcoin's status as legal tender after the congress passed a reformed Bitcoin Act, rendering its use voluntary.

While Bitcoin is often touted as a long-term hedge against inflation and economic turmoil, its short-term price movements tend to mirror those of high-risk assets. In this light, Trump's trade war, fueled by the new tariffs, could introduce further uncertainty, potentially impacting Bitcoin's price trajectory.

According to CNBC, investors are now keeping a close watch on the $90,000 support level for Bitcoin. Analysts warn that if the cryptocurrency falls significantly below this threshold, a further decline toward $80,000 could be on the cards.

Stock markets in panic following Trump tariffs

In other markets, stock futures pointed toward a steep decline in major U.S. markets on Monday, with the recent tariffs imposed by President Donald Trump on Canada and Mexico, and more to come, setting off panic among investors.

Stock markets in Asia tumbled on Monday following the announcement, with similar effects expected in other major markets, particularly on the NASDAQ. The U.S. dollar index rose more than 1%, nearing 110 by 9:00 a.m. (GMT+3), while the NASDAQ benchmark index awaits the opening, having closed at 19,627.44 on Friday.

Spot gold, which hit a fresh record above $2,800 per ounce last week, signaled a potential depreciation on Monday as a stronger dollar makes it more expensive for investors holding other currencies.

Trump's latest move capped a volatile week for markets, which were already shaken by the debut of DeepSeek's R1 chatbot. The AI-driven development prompted some investors to reconsider their heavy bets on tech giants in recent years.