Bitcoin has been under heavy pressure in early 2025, as the crypto market struggles to maintain its footing. After losing 12.19% of its value in February alone, Bitcoin’s price dropped below $100,000, raising concerns about a potential deeper downturn. The catalyst? Former President Donald Trump’s newly imposed 25% tariffs on steel and aluminum, which have added to the economic uncertainty already plaguing global markets. This latest development has investors asking: will Bitcoin bounce back, or are we facing another 2018-style crash?
The 25% import tax on metals is just the latest move in Trump’s “America First” strategy, which has already created significant market ripples. Bitcoin, which has often been seen as a safe haven during times of financial instability, is no exception. The new tariffs sent Bitcoin into a downward spiral, pushing it as low as $92,000, far from its once-promising six-figure highs. This sudden drop is a reminder of how global trade policies can directly affect cryptocurrency prices, particularly when it comes to Bitcoin’s volatility.
With inflation on the rise and the Federal Reserve uncertain about cutting interest rates, Bitcoin’s prospects are looking shaky. While the digital currency found some support between $88,000 and $90,000 in the short term, questions remain about whether this is the true bottom, or if Bitcoin will face more challenges in the coming months.
This situation echoes the events of 2018 when Trump’s tariffs on Chinese goods led to a severe market downturn, including a dramatic 72% loss for Bitcoin by the end of the year. Although no one is predicting a repeat of that catastrophic crash, the comparison highlights the risks Bitcoin faces when trade tensions escalate. With economic uncertainty lingering, many traders are becoming more cautious, and Bitcoin’s historical volatility could be reignited if tariffs continue to play a central role in shaping global markets.
Bitcoin’s traditional Q1 rallies have also failed to materialize, adding to the sense of unease in the market. Instead of the typical surge in investor interest, Bitcoin’s price has remained sluggish, raising doubts about its ability to rebound quickly.
For those still holding Bitcoin, patience is likely to be tested in 2025. The first two months of the year have already seen sharp declines, and with the ongoing uncertainties surrounding trade policies and the Federal Reserve’s actions, many investors are rethinking their strategies. Some are opting to lock in profits during each dip, while others are adopting a “HODL” mentality—holding onto their assets for the long haul in the hopes of a future price recovery.
This delicate balance between long-term holders (HODLers) and short-term traders has kept Bitcoin from sinking further. While institutional investments and ETFs have helped stabilize prices, Bitcoin’s price movement remains highly sensitive to shifts in global economic conditions.
The big question is whether Bitcoin can continue to thrive in the face of ongoing trade tensions and tariff-related risks. Investors are hoping that Bitcoin will serve as a hedge against inflation, as it has in the past. However, with tariffs adding more fuel to inflationary pressures, the future is far from clear.
As traders wait for further developments, the next Consumer Price Index (CPI) report will be crucial in determining the trajectory of both Bitcoin and the broader market. If inflation continues to rise unchecked, Bitcoin’s price may face further downward pressure, potentially forcing it to revisit its local lows.
Bitcoin’s future in 2025 is filled with uncertainty, with Trump’s new tariffs adding to the growing list of challenges. While the cryptocurrency has found temporary support at key price levels, the market remains volatile. For now, the best strategy for Bitcoin investors might be to hold steady and weather the storm, as the crypto market faces its toughest test in years.
Time will tell whether Bitcoin can survive this turbulent period or if further declines are inevitable. Investors must stay alert as the situation unfolds, with patience being the ultimate key to navigating this volatile market.
Steven is an explorer by heart – both in the physical and the digital realm. A traveler, Steven continues to visit new places throughout the year in the physical world, while in the digital realm has been instrumental in a number of Kickstarter projects. Technology attracts Steven and through his business acumen has gained financial profits as well as fame in his business niche. Send a tip to: 0x200294f120Cd883DE8f565a5D0C9a1EE4FB1b4E9
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