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The cryptocurrency market has been left frozen by U.S. President Donald Trump’s surprise announcement of sweeping global tariff hikes. As market leader Bitcoin slipped below the $65,000 level, Asian stock markets and the traditional safe-haven asset gold rose during the same period, laying bare the unique vulnerability of the crypto market.
According to CNBC on February 23 (local time), Bitcoin (BTC) fell more than 5% to as low as $64,816.8 immediately after President Trump announced plans to raise tariffs to 15% on a global scale. Ethereum (ETH), the second-largest cryptocurrency by market capitalization, also dropped nearly 6% to $1,865.7. After surpassing $125,000 in October last year, Bitcoin has been under sustained selling pressure, plunging more than 47% from its peak and 26% year-to-date.
Market experts assess that the current downturn reflects a multifaceted crisis beyond the impact of tariffs alone. Jeff May, Chief Operating Officer at BTSE, analyzed that fears of an economic slowdown triggered by the tariff hike, coupled with rising military tensions in the Middle East—including the possibility of a U.S. strike on Iran within the next 10 days—are fueling investor panic selling. Markus Thielen, Head of Research at 10x Research, warned that the current market represents a typical bear phase marked by drained liquidity and lack of conviction, adding that amid uncertainty surrounding the U.S. midterm elections, Bitcoin could fall further to $50,000 before establishing a true bottom.
Particularly striking is that Bitcoin, once described by Federal Reserve Chair Jerome Powell as “digital gold,” is moving in the opposite direction of actual gold. As investors’ preference for safe-haven assets strengthens, spot gold prices have risen about 1.5%, while the cryptocurrency market has been hit by significant capital outflows.
Matt Hougan, Chief Investment Officer at Bitwise, which manages more than $15 billion in assets, explained that the current decline follows crypto’s characteristic four-year cycle pattern. He noted that Bitcoin’s sharp drop is not the result of a single negative factor but rather a confluence of heavy headwinds, including capital rotating into gold and artificial intelligence stocks, concerns over Kevin Warsh—a hawkish nominee for the next Fed chair—and the looming security threat posed by quantum computing, known as “quantum risk.”
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