Shocking Timeline: Trump Tariffs Plunge Bitcoin Price Below $80K
Crypto markets are known for their volatility, but few anticipated the dramatic impact of political decisions on Bitcoin price. Since Donald Trump’s return to the White House, the crypto sphere has been on a rollercoaster, experiencing both exhilarating highs and concerning lows. This timeline dissects how Trump’s tariff announcements and the ensuing global trade tensions played a pivotal role in dragging Bitcoin price below the critical $80,000 mark, leaving investors in a state of uncertainty.
How Did Trump Tariffs Trigger Bitcoin’s Price Drop?
The year began with crypto optimism, but the inauguration of President Trump on January 20th marked the start of a turbulent period. Bitcoin price, which had soared to a record $109,000, began a sharp descent, ultimately dipping below $78,000. This wasn’t just market fluctuation; it was a direct response to major tariff announcements from the US and retaliatory measures from its trade partners. These events collectively shaved off significant value from the cryptocurrency market and sent ripples through global markets.
Justin d’Anethan, head of sales at Liquify, aptly described the market sentiment: “The back-and-forth on tariffs, with Trump sometimes tough and sometimes accommodating, has left markets in a limbo state.” Investors found themselves in a precarious position, hesitant to fully commit to bullish positions yet equally unwilling to liquidate assets, fearing they might miss out on a potential rebound. This ‘wait-and-see’ approach highlighted the profound impact of Trump tariffs on market confidence.
The Tariff Timeline: Key Events Impacting Bitcoin
Let’s break down the key events that contributed to the market volatility and Bitcoin’s price decline:
- Mid-March: Fleeting Hope: Initial signals from the White House suggested a more measured approach to trade, briefly boosting investor confidence. However, this optimism proved short-lived.
- April 2 – “Liberation Day”: Looming Reciprocal Tariffs: The anticipation of a second wave of “reciprocal tariffs” on April 2, ominously dubbed “Liberation Day,” kept market jitters alive and well.
Colombia Tariff Standoff and DeepSeek Disruption: The Initial Shocks
Even before the broader trade war escalated, specific events began to shake market confidence. Bitcoin price remained robust above $100,000 until January 26th, when a diplomatic clash with Colombia emerged.
- Colombian Tariff Threat: Trump threatened a hefty 25% tariff on all Colombian imports after President Gustavo Petro resisted accepting US military aircraft carrying deported migrants. Petro’s accusations of immigrant mistreatment and Colombia’s retaliatory tariffs further escalated tensions.
- Quick Reversal: Faced with significant trade pressure, Colombia swiftly reversed its stance, agreeing to accept deportees, and Bitcoin price briefly recovered to above $100,000.
- DeepSeek’s Emergence: Adding to the market unease was the rapid ascent of Chinese AI firm DeepSeek. Their budget-friendly AI model sparked fears of tech disruption, contributing to a risk-off sentiment across various markets, including crypto.
| Date | Event | Bitcoin Price Reaction |
|---|---|---|
| Late January | US-Colombia Tariff Standoff & DeepSeek Rise | Bitcoin dips below $100,000 |
Source: CoinGecko
The Trade War Ignites: Bitcoin’s Losses Mount
February witnessed a significant escalation in the trade war, directly impacting the crypto market.
- February 1: Executive Order – Tariffs on China, Canada, and Mexico: Trump signed an executive order imposing substantial tariffs: 10% on all Chinese imports and 25% on goods from Canada and Mexico, citing national emergency concerns related to immigration and fentanyl. These tariffs were set to take effect on February 4th.
- Retaliation Threats and Bitcoin Tumble: China, Canada, and Mexico all threatened retaliatory measures. The immediate market reaction was a sharp decline in Bitcoin price, plummeting below $93,000.
- Brief Relief – Canada and Mexico Pause: Bitcoin price saw a temporary rebound after Trump agreed to a 30-day pause on tariffs for Canada and Mexico on February 3rd. However, this recovery was short-lived.
- February 4: Chinese Tariffs Take Effect: The tariffs on Chinese imports proceeded as scheduled on February 4th, marking the last time Bitcoin price traded above the $100,000 threshold.
| Date | Event | Bitcoin Price Reaction |
|---|---|---|
| February 1 | Trump signs executive order for tariffs | Bitcoin tumbles below $93,000 |
| February 3 | Pause on Canada & Mexico tariffs | Bitcoin rebounds (dead cat bounce) |
| February 4 | Chinese tariffs effective | Bitcoin fails to reclaim $100,000 |
Source: CoinGecko
February Volatility: Hacks, Metal Tariffs, and Copper Concerns
February remained a period of intense market volatility for Bitcoin.
- February 10: Metal Tariff Hikes: Trump announced the removal of steel and aluminum tariff exemptions, increasing all metal tariffs to 25%, effective March 12th. He also introduced a “reciprocal tariffs” plan to match foreign import taxes.
- Brief Rally and Bybit Hack: Initially, Bitcoin price held steady around $93,000 and even briefly rallied to $99,000. However, this momentum was abruptly halted.
- February 21: Bybit Hack – Crypto Market Breach: The massive Bybit hack, the largest crypto breach in history at the time, sent shockwaves through the market. Bitcoin price plummeted again, falling below $90,000.
- February 25: Copper Tariff Review: Adding to the bearish pressure, Trump ordered a review of potential tariffs on imported copper, citing national security concerns. This further eroded investor confidence.
- Bitcoin Below $80,000: As a result of these cumulative pressures, Bitcoin price dipped below $80,000 for the first time since November.
| Date | Event | Bitcoin Price Reaction |
|---|---|---|
| Feb 21 | Bybit Hack | Bitcoin falls below $90,000 |
| Feb 25 | Copper Tariff Review | Bitcoin dips below $80,000 |
Source: CoinGecko
March: Glimmers of Hope Amidst Lingering Tariffs
March began with more tariff-related announcements, but also some potentially positive developments for the crypto market.
- March 1: Lumber and Timber Tariff Review: Trump initiated another tariff review, this time targeting lumber and timber imports.
- Strategic Bitcoin Reserve – A Crypto Boost?: The White House unveiled plans for a Strategic Bitcoin Reserve and digital asset stockpile, including XRP, SOL, and ADA. This announcement briefly sparked a crypto rally.
- March 4: Renewed Tariffs on Canada, Mexico, and China: Trump followed through with 25% tariffs on Canada and Mexico and doubled Chinese tariffs to 20%. Retaliation from all three countries was swift.
- March 5-6: Auto Tariff Exemption and USMCA Pause: A day later, Trump granted a one-month tariff exemption for US automakers importing from Canada and Mexico. The White House also extended a tariff pause on many imports under the USMCA, while still threatening reciprocal tariffs on April 2nd.
- Easing Tensions?: Trump acknowledged “unprecedented” border cooperation with Mexican President Claudia Sheinbaum, and Canada also signaled a potential easing of tensions.
- Bitcoin’s Struggle to Rebound: Despite these mixed signals, Bitcoin price see-sawed around the $90,000 mark but ultimately dipped below it on March 7th, failing to reclaim that level since.
- Steel and Aluminum Hikes Finalized: Trump finalized the steel and aluminum tariff increases.
- March 13: Wine and Spirits Tariff Threat: Trump threatened a massive 200% tariff on European wine, champagne, and spirits if the EU proceeded with a 50% tax on American whiskey in retaliation for the steel and aluminum tariffs.
| Date | Event | Bitcoin Price Reaction |
|---|---|---|
| March 7 | Bitcoin dips below $90,000 | Fails to reclaim level |
| March 1 & March 16 | Bitcoin trades around $84,000 | Volatile swings in between |
Source: CoinGecko
Softening Tone and Bitcoin Rebound: Is Relief in Sight?
By mid-March, a shift in the administration’s rhetoric offered a glimmer of hope for the crypto market.
- March 18: Tailored Tariffs and Potential Avoidance: Treasury Secretary Scott Bessent indicated that tariffs would be more targeted, country-specific, and potentially avoidable if trade partners reduced their own barriers.
- Market Recovery: Financial markets, which had been on edge for weeks, began to show signs of recovery.
- March 24: Bitcoin’s Upward Movement: Bitcoin price rose to $88,474 on reports suggesting the next round of Trump tariffs would be more targeted than initially feared.
| Date | Event | Bitcoin Price Reaction |
|---|---|---|
| March 24 | Softer White House tone on tariffs | Bitcoin recovers to $88,474 |
Source: CoinGecko
“Liberation Day” and Lingering Uncertainty
Despite the recent positive signals, the crypto market remains fragile as “Liberation Day” (April 2nd) approaches. Ryan Lee, chief analyst at Bitget Research, anticipates continued market volatility leading up to April 2nd, along with corporate lobbying, preemptive price increases, and global diplomatic efforts to mitigate the tariff impact.
Lee further warns of potential consequences after the tariffs take effect: “anticipate inflation spikes, supply chain disruptions, and mixed job outcomes, with potential stock market shocks and retaliatory trade measures…possibly slowing US economic growth.”
Liquify’s d’Anethan emphasizes the importance of monitoring traditional markets, given Bitcoin’s increasing correlation with indexes like the S&P 500. He suggests that geopolitical events like Trump tariffs and broader market movements should not be discounted when assessing Bitcoin price trends.
With April 2nd looming, the crypto world is holding its breath, bracing for the potential impact of “Liberation Day” and the next chapter in the Trump tariffs saga. Trump’s recent hints about considering tariffs on automobiles, aluminum, and pharmaceuticals only add to the uncertainty, suggesting that the crypto market and Bitcoin price may continue to be influenced by these policies for the foreseeable future.
