Bitcoin plunged below $87,000 on Monday as former President Trump’s latest trade policies and growing recession fears rattled both crypto and traditional markets. The leading cryptocurrency erased Sunday’s gains and now trades around $86,700, marking a 28% decline from its recent all-time high of approximately $104,000.
The selloff intensified after Trump announced new tariffs against Mexico, Canada, and China, sparking concerns of an escalating trade war. These moves, combined with disappointing Non-Farm Payrolls data and looming government shutdown fears, created a perfect storm that sent investors fleeing to safer assets. Top tech executives from HP and Intel are scheduled to meet with Trump to discuss the implications of these policies.
Adding to the downward pressure, institutional players like MicroStrategy face mounting scrutiny over their Bitcoin holdings. The company’s substantial position has become a focal point for market watchers, with some analysts suggesting further price declines could force liquidations. Notably, some experts warn a drop to the last chance $60,000-$65,000 range could materialize if current market conditions persist.
Other public companies with significant crypto holdings are experiencing similar pressures, as reflected in declining crypto-related stocks.
Technical analysts point to $99,500 as a vital resistance level, with some projecting a potential drop to the $63,000-$65,000 range if current support levels fail. The crypto market’s volatility has been amplified by broader economic uncertainties, despite Trump’s administration implementing various crypto-friendly policies, including the establishment of a digital assets working group and proposals for a national crypto reserve.
Meanwhile, Congress is ramping up its regulatory focus, forming a bicameral working group and establishing a new Senate subcommittee dedicated to digital assets. The upcoming Crypto Summit could provide crucial signals about the regulatory landscape’s evolution.
The ETH/BTC ratio has hit a new five-year low of 0.025, while other major cryptocurrencies like Solana, XRP, and Cardano have followed Bitcoin’s downward trajectory. Despite some analysts maintaining optimistic long-term projections of $250,000 by year-end, the current market sentiment reflects growing unease, as evidenced by elevated volatility levels and increased demand for downside protection in the options market.
