Crypto sentiment plummets to ‘Extreme Fear’ with the Crypto Fear & Greed Index falling to 25 points, driven by Trump’s firm commitment to tariffs on Mexico and Canada. Bitcoin dipped below $92,000 as overall crypto market value shrank nearly 8%. Traditional markets also reflect this downturn as traders brace for potential trade war repercussions.
The world of cryptocurrency has taken a sharp downturn, largely attributed to a statement made by US President Donald Trump. He declared that his tariffs on Mexico and Canada are firmly “going forward,” leading to a significant drop in market sentiment. The Crypto Fear & Greed Index plummeted to just 25 points, indicating a state of “Extreme Fear” among traders, down from a neutral 49 just a day prior.
At a news conference alongside French President Emmanuel Macron, Trump reaffirmed that his proposed 25% tariffs on imports from Canada and Mexico will remain in effect, despite previous discussions of a temporary pause. Initially announced on February 1, these tariffs, excluding 10% on Canadian energy imports, have caused ripple effects across the market, prompting Bitcoin to fall considerably.
In the aftermath of these tariff announcements, Bitcoin slid from approximately $105,000 to $92,900, while the liquidation of Ether reached a staggering $2.2 billion. This market anxiety is fueled by fears of a potential trade war as Canada and Mexico threatened to retaliate. Just a few days after the announcement, Trump temporarily paused the tariffs but is now signaling their resumption.
The impact of Trump’s tariffs is evident not only in cryptocurrencies but also in traditional markets. Bitcoin lost 4.5% in the last 24 hours, reaching below $92,000. The broader crypto market saw a nearly 8% decline, reducing its total market value from over $3.31 trillion to around $3.09 trillion. Likewise, the S&P 500 and Nasdaq Composite have both recorded declines, reflecting widespread market unease. The last similar sentiment felt in the crypto space, categorized as “Extreme Fear,” was back in September when Bitcoin hovered around $54,000 due to steep losses.
In summary, the cryptocurrency market is currently experiencing profound instability fueled by President Trump’s reaffirmation of tariffs on Canada and Mexico. The sharp drop in the Crypto Fear & Greed Index to extreme levels highlights traders’ anxiety. With Bitcoin now below $92,000 and the overall crypto market declining nearly 8%, the echoes of trade tensions resonate beyond just digital coins, affecting broader financial landscapes as well.
Original Source: cointelegraph.com
