Bitcoin Weakens as Inflation Fears, Trump Tariffs Pressure Crypto Markets
By early Asian trading, Bitcoin had retreated to $83,200, ending last week's rally and showing weakness against a strong recovery in US stocks. Meanwhile, Ethereum, the second-largest cryptocurrency, fell to $1,585. Altcoins were also mixed, data from CoinGecko showed.
The decline was triggered by a series of inconsistent statements from the Trump administration about the possibility of tariffs on electronics imported from China, including smartphones, semiconductors, and laptops. The sudden changes in messaging have unsettled cryptocurrency investors, especially as the market is sensitive to any signals from monetary and trade policy.
On Sunday evening, President Trump clarified on the Truth Social platform that while some items would be temporarily exempted from the 10% “reciprocal” tariff, electronics would still face a separate 20% tariff, citing national security and the fight against fentanyl.
“No one is exempt. China has treated the United States unfairly for decades,” Trump wrote. “There were no tariff ‘exceptions’ announced on Friday as falsely reported by the media.”
Commerce Secretary Howard Lutnick confirmed that the new tariff list will be officially announced within the next 60 days.
Meanwhile, the US stock market was more optimistic. Nasdaq 100 futures rose more than 1.1% on Monday, while the S&P 500 rose 0.7%. However, the cryptocurrency market failed to benefit from the optimism, indicating that the defensive sentiment prevailed.
BlackRock, the world's largest asset manager, reported that the value of digital assets in its ETFs fell nearly 9% in the first quarter of 2025, equivalent to about $5 billion, although it still recorded positive net inflows during the same period. As of March 31, the fund still held more than $50 billion in digital assets.
Bitcoin had rallied a few days earlier when US CPI data showed inflation rose just 2.4% in March, below expectations of 2.6%. However, geopolitical uncertainty and slowing institutional inflows have reversed those expectations.
“New tariffs could put pressure on consumer prices and delay a Fed rate cut until at least June,” said Darren Chu, an analyst at BRN.
For now, analysts are closely watching technical support around $81,000. If this level is broken, the market could see a wave of leveraged liquidations, sending Bitcoin prices lower in the coming days.