The so-called “Trump effect” was on full display Friday morning when President Donald Trump announced a 50% tariff on all European Union (EU) goods entering the U.S., sending both traditional and crypto markets tumbling.
Coinmarketcap showed a 1.63% decline in the crypto market capitalization, which shrunk to $3.45 trillion. Stocks suffered a similar retreat with the S&P 500, the Nasdaq, and the Dow all shedding 0.74%, 0.96%, and 0.58%, respectively, according to CNBC.
The new EU tariffs, if implemented, will take effect on June 1. Trump also threatened to slap a 25% import tax on Apple iPhones that are not manufactured domestically. Apple stock tumbled 2.53% on the news.
“The European Union, which was formed for the primary purpose of taking advantage of the United States on trade, has been very difficult to deal with,” Trump wrote in a post on Truth Social. “Therefore, I am recommending a straight 50% tariff on the European Union, starting on June 1, 2025.”
(Trump posted a message threatening to impose a 50% tariff on all EU goods entering the U.S. / President Donald Trump on Truth Social)
Despite Trump’s antics and the subsequent retreat bitcoin experienced, the cryptocurrency is still trading at a respectable $108,574.13, which is close to its previous all-time highs. The price reflects a 2.64% decline on the day, but it remains up 4.35% over the past week. During the past 24 hours, BTC fluctuated between $107,385.27 and it’s new all-time high of $111,970.17, recorded on Thursday afternoon, according to data from Coinmarketcap.
( BTC price / Trading View)
Trading activity cooled, with 24-hour volume falling to $65.68 billion, down 25.83%, reflecting the post-surge digestion from Thursday’s bullish frenzy. Meanwhile, bitcoin’s market capitalization slipped 1.87% to $2.17 trillion. BTC dominance also edged slightly lower by 0.05% to 63.98%, which may signal a modest shift in investor attention toward altcoins.
( BTC dominance / Trading View)
In the derivatives market, BTC futures open interest dropped by 3.12% to $78.04 billion, indicating a decrease in leveraged positions. Liquidation data from Coinglass shows bulls bore the brunt, with total liquidations hitting $3.72 million, including $3.28 million in long positions, compared to just $440,650 in shorts. The correction underscores the risks of overleveraging during volatile surges, especially with a president who can move markets with a single social media post.
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