As Amber Group analysts stated: "When a presidential tweet can instantly wipe out $30 billion in market value, this market can no longer pretend to live outside the law." This baptism may be a necessary lesson for cryptocurrency to integrate into the mainstream financial system.
Author: Techub News
Related: Full Record of Guest Invitations for the White House's First Cryptocurrency Summit
Although Trump's return to the White House initially ignited optimism in the cryptocurrency market, a global trade storm triggered by tariff policies ultimately dragged Bitcoin down from its historic high of $109,000 to a low of $78,000. This article reviews the epic market turmoil through key events.
Act One: A New Official's Three Fires (January 2025)
On January 20, the day Trump was sworn in, Bitcoin's price remained at a high of $107,000. On January 23, President Trump signed an executive order to establish a digital asset working group to explore regulatory reforms for digital assets. However, just six days later, the Colombian immigration dispute ignited the first round of crisis—Trump threatened to impose a 25% tariff on Colombian goods, causing Bitcoin to fall below the psychological threshold of $100,000. Although both parties reached an agreement a week later to push the price back up, the rise of Chinese AI giant DeepSeek triggered a sell-off in tech stocks, and risk-averse sentiment spread to the cryptocurrency market.
Key Data: From January 26 to 28, Bitcoin's daily volatility reached 12%, marking the largest fluctuation since May 2024.
February Storm: The Tariff Nuclear Button Activated
On February 1, Trump signed an executive order announcing a 10% tariff on Chinese goods and a 25% tariff on goods from Canada and Mexico. In response to the market's severe reaction, Bitcoin plummeted 9.3% in a single day to $93,000. Although the delay in implementing tariffs on North American neighbors brought a brief rebound, the escalation of steel tariffs and the announcement of the "reciprocal tariff" plan on February 10, combined with the $1.4 billion epic hack incident at Bybit exchange, ultimately led to Bitcoin falling below the $80,000 mark for the first time since November 2024 on February 25 due to news of copper tariff reviews.
Market Observation: BitMEX data showed that open interest in February futures contracts decreased by 37%, indicating a significant withdrawal of leveraged funds from the market.
March Tug-of-War: Breathing Space Amid Policy Fluctuations
On March 4, the policy's double-edged sword sent mixed signals from the White House: the announcement of a strategic digital asset reserve plan including XRP boosted confidence, but tariffs on China were doubled to 20%. This "carrot and stick" strategy kept Bitcoin oscillating between $84,000 and $90,000. On March 18, a turning point emerged as Treasury Secretary Basent first stated the "differentiated tariff" policy, suggesting that if trade partners lowered barriers, tariff escalations could be avoided. The market interpreted this as the first glimmer of policy softening, with Bitcoin rebounding 3.1% in a single day to surpass $85,000. On March 20, the Federal Reserve provided dual support by deciding to maintain interest rates and indicating at least two rate cuts within the year. The moment the decision was announced:
Bitcoin surged $800 in one minute
Open interest in Bitcoin futures at the Chicago Mercantile Exchange surged by $1.1 billion
The total market cap of stablecoins expanded by 4.3% in a single day (Tether's CTO confirmed the issuance of an additional $1.8 billion USDT)
On March 24, the policy resonance effect led to a rebound of 8.7% in Bitcoin over the week, approaching $89,000, under the dual stimulus of expectations for tariff policy easing and liquidity expansion. On-chain data showed that whale addresses (holding over 1,000 BTC) accumulated 213,000 Bitcoins during this period, marking the largest weekly accumulation since Q4 2024.
April Time Bomb: Market Anxiety Before Liberation Day
Despite signs of warming in late March, the effective date of the "reciprocal tariff" on April 2 loomed like the sword of Damocles. Bitget Research Institute's simulations indicated:
If tariffs were fully implemented, it could trigger a $2.3 trillion contraction in global trade volume
The correlation between Bitcoin and traditional assets rose to a historical peak of 0.78
Supply chain disruptions could lead to an 18% increase in mining production costs
Institutional Strategy: Liquifi monitored that net inflows of stablecoins reached $4.7 billion in the last two weeks of March, indicating that funds were "locked and loaded" waiting for directional decisions.
Market Revelation: The Coming of Age of Digital Currency
This crisis exposed the deep transformation of the cryptocurrency market:
Increased policy sensitivity: The correlation between BTC and the S&P 500 index exceeded 0.7 over three months
Differentiation of safe-haven attributes: Gold rose 23% during the same period vs Bitcoin's 28% decline
End of regulatory arbitrage: The U.S. Treasury has frozen $1.2 billion in on-chain assets suspected of tariff evasion
As Amber Group analysts stated: "When a presidential tweet can instantly wipe out $30 billion in market value, this market can no longer pretend to live outside the law." This baptism may be a necessary lesson for cryptocurrency to integrate into the mainstream financial system.
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