Bitcoin Sells Off Sharply as Threat of Global Trade War Nears

According to Bloomberg, the cryptocurrency market witnessed a strong sell-off as it entered the new week in Asia, clearly reflecting the "risk-off" sentiment spreading across financial markets.

Illustration of bitcoin cryptocurrency. Photo: REUTERS/TTXVN

Accordingly, Bitcoin lost about 7% of its value from the evening of April 6 to the morning of April 7, Singapore time, falling to a low of $77,077. The second largest cryptocurrency, Ether, also plummeted to $1,538, an intraday low not seen since October 2023.

The sharp decline in a series of cryptocurrencies comes as US President Donald Trump continues to insist on his policy of imposing wide-ranging tariffs - a move that has caused the US stock market to evaporate trillions of dollars in recent days. US stock index futures also fell sharply, while the Japanese Yen soared, showing that "panic" is spreading deep into the global financial system.

Data from Coinglass shows that around $745 million in bullish bets on cryptocurrencies in the market were liquidated over the past 24 hours – the highest figure in nearly six weeks.

“The options market suggests that selling pressure is likely to continue, with the put option spread increasing significantly,” said Sean McNulty, head of derivatives for Asia Pacific at digital asset brokerage FalconX, noting that key support levels for Bitcoin and Ether are currently at $75,000 and $1,500, respectively.

Digital assets had previously shown remarkable resilience to the widespread panic that followed Trump’s initial tariff announcement, which was thought to have sparked hopes that the crypto market could decouple from the orbit of tech stocks. However, the April 7 sell-off may have put an end to those hopes.

Cosmo Jiang, a partner at Pantera Capital, said that at the moment, macro factors are dominating the entire development. “The adjustment caused by tariffs is an isolated phenomenon, not rooted in deep economic problems. Just as it is artificially inflated, it can also be withdrawn if the Trump administration feels it has won concessions from other countries,” he added.

In a related development, Taras Kulyk, CEO of Synteq Digital, a Bitcoin mining equipment broker, said they are speeding up the shipment of thousands of miners from Southeast Asian countries such as Indonesia, Malaysia and Thailand to the United States before the new tariffs take effect.

Similarly, Luxor Technology, a company that provides Bitcoin mining software and services, is currently rushing to ship 5,600 devices from Thailand to the United States.

Luxor’s chief technology officer, Lauren Lin, told Bloomberg that the company is considering chartering a private jet to bring the equipment back to the U.S. in less than 48 hours, as a 10% tariff will be imposed on all imports, while goods from Thailand could be taxed up to 36% starting April 9.

Previously, most of the companies that manufacture Bitcoin mining machines were considered to be based in China. However, after the US imposed sanctions and trade tariffs since 2018, many companies have moved to Southeast Asian countries such as Thailand or Indonesia. However, with the US applying new reciprocal taxes, these companies are forced to consider locating factories in the US to avoid huge taxes.

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