Over the weekend, Bitcoin experienced a significant drop, falling 6% to $77,730 amid global market volatility spurred by new tariffs announced by US President Donald Trump. This decline contributed to the steepest drop in US equities since 2020 and quickly spread to digital assets. Bitcoin, which had mostly stayed above $80,000 this year, dipped below the crucial $78,000 mark.
This decrease puts Bitcoin about 28% below its record high from January. Other major cryptocurrencies also saw significant losses, with Ethereum falling 13% to $1,568, XRP down nearly 12%, and Solana dropping over 12% to $105.43. Bitcoin has been tracking major tech stocks closely, often moving in sync with indices like the S&P 500 and Nasdaq. Last week’s Wall Street sell-off, driven by fears of a global trade war, dragged Bitcoin down alongside equities. Analysts have noted a high correlation between Bitcoin and the stock market, with a correlation of 0.88 recorded in March.
The market stress extended beyond the US. Hong Kong’s Hang Seng index plummeted over 10% on Monday, marking its largest single-day drop since the 2008 financial crisis. Chinese stocks also suffered due to more than 50% in US tariffs, with Beijing responding by imposing new levies on American imports. This escalation has raised concerns about a potential global recession, with Goldman Sachs now placing the odds of a US recession at 45% within the next year.
Despite the turmoil, some in the crypto community remain optimistic. Gadi Chait of Xapo Bank advised investors to stay calm, emphasizing Bitcoin’s long-term value despite short-term fluctuations. Coinglass data revealed that $976 million in crypto positions were liquidated in the past 24 hours, with long positions making up $842.2 million of that total. Over 318,000 traders were affected by these liquidations, highlighting the rapid shift in market sentiment. Traders are now closely watching the $76,600 level, as a drop below this point could indicate a deeper correction. For now, Bitcoin remains within a broader trading range, and many hope this is just a temporary shakeout in an otherwise resilient market.
