Crypto Market Loses Over $130 Billion in Market Value Due to Trump Tariff Uncertainty

The crypto market lost more than $130 billion in market value in the last week. According to data from Coingecko, Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and Solana (SOL) fell by 5.9%, 10.9%, 15%, and 10.1%, respectively. The upcoming tariffs from U.S. President Donald Trump will affect more than $1.5 trillion in imports by the end of April, Kobeissi's letter noted.

Crypto and global markets are under pressure from the upcoming announcement of U.S. President Donald Trump’s tariff plan, which is set to be released on April 2. Crypto markets took a beating last week, with total market capitalization losing more than $130 billion, according to CoinGecko.

According to the Kobeissi letter, U.S. tariffs will affect more than $1.5 trillion in imports by the end of April.

"President Trump calls Wednesday Liberation Day and will impose tariffs of 20%+ on over 25 countries," Kobeissi said in his X post.

Specifically, this was the day President Trump announced "reciprocal tariffs," the report explains. These would be "new tariffs", on top of existing and announced ones.

The Economic Policy Uncertainty (EPU) Index chart below measures uncertainty in U.S. economic policy since 1985 and is currently at 600, 80% higher than during the 2008 financial crisis, showing extreme market uneasiness. Historical peaks in the indicator suggest that high uncertainty often precedes major market moves, as seen during the 2008 crisis and the 2020 COVID-19 lockdowns.

Such high uncertainty and volatile market conditions tend to trigger risk aversion among investors as they turn to safer assets such as gold, potentially curbing demand for cryptocurrencies.

Additionally, the Wall Street Journal (WSJ) reported on Monday that President Trump's team is considering imposing "broader and higher tariffs" before Wednesday's reciprocal tariff deadline.

President Trump is reportedly considering "general increases of up to 20 percent." Again, April 2 is not just the end of tariff uncertainty, according to Kobeissi’s letter on X’s post.

With uncertainty and volatility affecting global and crypto markets, crypto markets may see volatility and potential sell-offs in the short term as risk aversion takes hold. However, in the medium to long term, Bitcoin and other cryptocurrencies may benefit from increased demand to combat inflation and economic uncertainty, especially in the event of rising inflation and weakness in traditional markets. The historical correlation between EPU shocks and crypto trading volumes, as well as Bitcoin’s perception as a “safe haven asset,” support this outlook, although short-term risks remain significant due to broader market dynamics.