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The price of Bitcoin dropped below $85,000 due to concerns about U.S. trade policy, contributing to a considerable downward spiral in the cryptocurrency market on February 27, 2025. All of the major altcoins suffered, with Ethereum and XRP down by as much as 7%.
Movement in the Market and Underlying Elements
Bitcoin does have an overall market capitalization of $1.679 trillion, while its dominance in the cryptocurrency market is at 59.73%. The trading volume decreased by 15.85% to sit at $67.18 billion over a span of a day. According to CoinMarketCap, out of the total trading volume, stablecoins composed $146.59 billion or 95.08% of total trading volume.
Most recently, the volatility of the market has been attributed to U.S. trade policy. With a definite deadline, President Donald Trump caused confusion on future tariffs on Canada and Mexico by hinting at an April 2 implementation, a full month delay from the original deadline. A later clarification from a White House official would contradict the initial claim that the March 2 date remains effective "as of this moment".
As a consequence, U.S. Treasury yields moved higher. The two-year yield rose to 4.09% from a previous low of 4.065%, while the yield for 10 years climbed to 4.2772% from a 2.5-month low of 4.245%. Shifting to safer assets would bring additional selling pressure on cryptocurrencies.
Major Cryptocurrencies Hit
At 10:22 AM IST, Bitcoin was trading lower at $84,762, a 4.9% drop from the day before. Ethereum was trading at $2,317, having fallen 7.1%. The global cryptocurrency market capitalization has dropped by 4.2% to $2.81 trillion in the past 24 hours.
Most of the other major altcoins were also down. The price of BNB fell by 2.07% to settle at $53,353. XRP, which fell by 4.79%, traded at a price of $191. Solana lost value by 7% and traded at $21. These movements indicated an overall market response to the currently growing economic and policy uncertainties.
Expert Insights
Vikram Subburaj, CEO of Giottus, commented on the situation: "Today, Bitcoin and the broader crypto market have caught the tailwind of a sudden drawn-down, suffocated in low macro sentiment. Briefly, it has gone down to $82,300 following hearing about the U.S.'s plans to impose a 25% tariff on the EU. More than 157,000 leveraged traders were liquidated today, totaling $766 million loss, 80% of which was due to longs."
This view emphasizes the higher volatility and the cascading effects of macroeconomic policies on the cryptocurrency market.
Investor Considerations
The current market conditions indicate the vulnerability of cryptocurrencies to global economic policies and geopolitical events. Investors should therefore take possible caution, be ready with thorough research, and diversify their portfolios to mitigate possible risks due to unreliability brought by such volatility.