Crypto Market Loses 25% Of Value As Recession Worries Mount
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The cryptocurrency market is experiencing a massive recession this week, amid growing concerns about the potential trade war and disappointment surrounding the U.S. government’s crypto reserve plan. His recent interview with President Donald Trump hints at the possibility of a recession, leaving investors further unresolved.
Crypto market declines: XRP, Solana and Cardano focus on Bitcoin’s downward trend
Bitcoin, the flagship cryptocurrency, has dropped nearly 4% in the past 24 hours to $79,000, a level not seen since mid-November. (ETH), which fell to $1,860, down 10% and has never seen 10% since August.
Other established cryptocurrencies are also feeling stressed. XRP has fallen 4%, Solana (Sol), while Cardano (ADA) has dropped 8%.
The background of this volatility includes the continued active tariff policies implemented by the new President Donald Trump administration on countries such as Canada, China and Mexico.
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These actions have sparked fear of a trade war, which could exacerbate inflation and increase Imported goods. As a result, investors are leaning towards safer investments, avoiding the infamous volatile cryptocurrency market.
In a Fox News interview over the weekend, Trump acknowledged that a positive tariff strategy could lead to a recession and described the country as a “transitional period.”
The comment raised alarms from investors, especially since Trump did not rule out the possibility of a recession this year. Jake Ostrovskis Famous The former president stressed the possibility of “short-term economic pain” that would increase market anxiety.
Risk appetite reduction and Fed rate outlook
Recently, uncertainty about the White House’s National Crypto Reserve Program has exacerbated uncertainty. Many in the cryptocurrency community expect Trump’s proposal to involve the government’s massive purchase of Bitcoin and other cryptocurrencies, which may stimulate demand and Increase the price.
But investors were disappointed when it was revealed that the government would avoid making additional cryptocurrency purchases and retain only cryptocurrency seized from illegal activities.
Haider Rafique, global chief marketing officer of crypto exchange OKX, expressed disappointment over the lack of immediate disappointment Buying pressure Formalization from Bitcoin reserves.
“While building a Bitcoin reserve is an important milestone, it does not immediately create buying pressure, disappointing those who expect to accumulate accumulation,” Rafik said.
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This downturn in the cryptocurrency market is also a broader trend in low-risk appetite among investors. As the Fed announced in December that it would not impose too much interest Cut fees As previously expected, in 2025, the cryptocurrency market lost about 25% of its market capitalization.
Due to the significant impact of macroeconomic factors in the market, the optimistic outlook for many people after Trump’s election in November quickly turned into sour.
Featured images from dall-e, charts from tradingview.com
