The cryptocurrency market has suffered a sharp downturn, shedding over $150 billion as Bitcoin (BTC) dropped below $100,000 following escalating global trade tensions. The turmoil comes after U.S. President Donald Trump announced hefty tariffs on imports from China, Canada, and Mexico, triggering retaliatory measures that sent shockwaves through financial markets, including the crypto sector.

Bitcoin Struggles Below $100K

Bitcoin had a volatile week, initially dropping from $105,000 to $98,000, before recovering to a weekly high of $106,500 after the U.S. Federal Reserve decided to keep interest rates unchanged. However, BTC failed to sustain its momentum, plunging on Friday and experiencing another sharp selloff over the weekend, touching a low of $99,000.

This unexpected drop is largely attributed to Trump’s executive order imposing a 10% tax on all imports from China and a 25% tax on goods from Canada and Mexico. While Canada’s energy exports will be taxed at a lower rate of 10%, the move has sparked immediate retaliation. Mexico and Canada have imposed counter-tariffs on U.S. goods, and China has threatened to file a World Trade Organization (WTO) complaint.

Bitcoin’s market capitalization has tumbled to $1.97 trillion, though its market dominance has risen to over 56%, indicating that altcoins have suffered even heavier losses.

Altcoins Hit Hard by Market Bloodbath

As is often the case during large-scale corrections, altcoins were hit the hardest. Ethereum (ETH) has slumped 4.5% to $3,100, while XRP has dipped below $2.90. Other major assets like Solana (SOL), Dogecoin (DOGE), Chainlink (LINK), Avalanche (AVAX), Toncoin (TON), and Stellar (XLM) have lost between 7-9%.

Among the worst-performing assets, JASMY, RAY, TAO, LDO, THETA, FET, and GALA have all plunged by double digits, wiping out recent gains. The total cryptocurrency market capitalization has now dropped to $3.5 trillion, according to data from CoinGecko.

What’s Next for Crypto?

The combination of macro uncertainty and geopolitical tensions could continue to fuel market instability. The crypto market has historically reacted sharply to major global economic policies, and Trump’s aggressive trade stance has introduced a new layer of unpredictability. Investors will closely watch how retaliatory measures from China, Canada, and Mexico unfold in the coming weeks, as well as potential shifts in monetary policy from the U.S. Federal Reserve.

Despite the downturn, long-term Bitcoin bulls may see this correction as a buying opportunity, especially if BTC finds strong support at the $99,000-$100,000 range.