The Bitcoin that had managed to exceed US $ 100,000 over the weekend, goes back to minimums of almost a month. How can the expectation of inflation rise in the US impact on cryptocurrencies.
The cryptocurrencies yield up to 19% this Monday, February 3 and Bitcoin reaches minimums of almost a month, on a day in which the risk assets are in red, after the tariffs imposed by Donald Trump.
What Donald Trump da, Donald Trump takes it away. The Bitcoin (BTC), which on Saturday exceeded US $ 100,000, goes back 4.07% according to Binance and now stands at US $ 95,400, after Lto the decision of the president of the United States to fulfill his promise to impose tariffs on Canada, Mexico and China.
The rest of the cryptocurrency market faces even more pronounced falls led by Cardano with a 19.5%decrease, followed by the strong Avalanche falls (-16.4%), Shiba Inu (-15.2%) and Toncoin ( -13.9%). Ethereum deserves a separate point whose collapse is 16.09% and falls au $ 2,600, reaching minimums in four months.
World Liberty Financial (WLFI), the crypto project backed by the Trump family, also had a significant impact, with a 20% drop in its investments in January cryptocurrencies, according to Spotonchain data. In the last hours, the collapse exceeds 9%.
The fear of the commercial war that impacts cryptocurrencies
The fear of a rebound in inflation due to these tariff measures is affecting both cryptocurrencies and other risk assets. The Federal Reserve (FED) had paused its cycle of cuts in interest rates, hoping to evaluate the impact of Trump policies on inflation and economic growth. Some analysts do not rule out a new increase in rates, which could further harm cryptoactives.
“At some point, the Fed will have to reactivate quantitative flexibility (QE) to stop the appreciation of the dollar and avoid prolonged hardening of financial conditions, as well as a slowdown in global growth,” Bitwise’s specialists warn.
However, cryptocurrencies are not the only ones affected. The bags worldwide have come into free fall after the beginning of what ‘The Wall Street Journal ‘has described as “the most stupid trade war in history.” 25% tariffs to Canada and Mexico, together with the additional 10% on Chinese products, have promoted a strong appreciation of the US dollar and an increase in the price of oil.
Source: Ambito
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