Bitcoin drops below $120K as Trump threatens higher tariffs on China, sparking market-wide volatility and liquidations across cryptocurrencies.
Bitcoin experienced a sharp decline after U.S. President Donald Trump threatened to raise tariffs on Chinese imports. This announcement sent shockwaves through the crypto market, causing Bitcoin to drop below the key $120,000 support level.
The decline in Bitcoin’s price was part of a larger market downturn that affected other cryptocurrencies as well.
Bitcoin Drops Below $120K
Bitcoin was trading just above $121,000 before Trump’s comments but quickly fell below $120,000 after the announcement.
The sharp drop was linked to the threat of higher tariffs on China, which raised concerns over a new trade war. As a result, Bitcoin’s price suffered a significant drop, breaking through key support levels.
The price of Bitcoin remained volatile after the initial decline, struggling to regain support. Investors were wary of the broader implications of Trump’s comments, which sparked uncertainty in the market.
With Bitcoin’s price under pressure, many traders chose to sell their holdings.
Market-Wide Impact of Tariff Threat
Bitcoin was not the only cryptocurrency affected by Trump’s tariff threat.
Other major cryptocurrencies, including Ethereum, Solana, and Dogecoin, also saw losses. Ethereum dropped below $4,200, falling by more than 3% in just a few hours. Solana and Dogecoin experienced similar declines, with both dropping over 2%.
The broader crypto market reacted negatively to the news. Cryptocurrencies, which are considered riskier assets, tend to be sensitive to macroeconomic uncertainty.
As a result, the market witnessed a widespread sell-off, with investors pulling out of positions to avoid further losses.
Liquidations and Market Volatility
The sudden drop in Bitcoin’s price led to a wave of liquidations in the crypto market. CoinGlass data shows that over $420 million in long positions were liquidated within an hour of Trump’s remarks.
Bitcoin and Ethereum accounted for most of these liquidations, with $73 million and $175 million, respectively.
In total, around $895 million in liquidations were recorded within 24 hours. This included both long and short positions, with long positions making up the majority.
Despite the increased volatility and liquidations, institutional investors continued to buy Bitcoin during the dip, as evidenced by recent inflows into Bitcoin ETFs.
Moreover, Trump’s tariff threat has created renewed uncertainty in the market. While Bitcoin and other cryptocurrencies faced losses, institutional interest remains strong, showing that the crypto sector continues to attract investors.
Hence, the ongoing volatility reflects the broader economic concerns that continue to shape market sentiment.