Bitcoin prices fell sharply early Friday, falling below the key support level of $110,000 after former US President Donald Trump proposed a 50% tax on goods imported from the European Union (EU). The proposal, if implemented from June 1, 2025, has sent shockwaves through global financial markets and sparked a sell-off among investors.
Bitcoin Reverses After Record High
Just hours earlier, Bitcoin had set a new high of $111,970, buoyed by strong institutional buying and growing confidence in the cryptocurrency's role as a store of value. However, Trump's unexpected policy statements quickly dented the rally. BTC then dropped to a low of $107,300, before recovering slightly to $108,881 – a 0.2% decline on the day.
The impact spread across the market
Not only Bitcoin, the entire cryptocurrency market was also negatively affected. The total crypto market capitalization fell 2.8% within 24 hours, to $3.42 trillion. Major coins such as Ethereum, Solana and a series of other altcoins recorded similar declines, reflecting increased caution from investors in the face of global trade instability.
At the same time, the stock market was also on fire. US stock indexes fell sharply after Mr. Trump threatened to impose an additional 25% tax on Apple products if the company did not move its production lines to the United States. In Europe, major indexes fell about 2%.
$110,000 Support Level Broken
Bitcoin’s loss of the $110,000 mark – which is considered an important technical support level formed by institutional investment flows – shows that market sentiment is becoming unstable in the face of sudden policy changes. Experts warn that if the geopolitical situation continues to be tense, Bitcoin prices may continue to correct in the short term.
Reaction from experts and the market
Michael Saylor – co-founder of Strategy (MSTR) – reassured investors that Bitcoin is not affected by trade barriers or tariffs. “There are no tariffs for Bitcoin,” he wrote on social network X.
However, Chicago Federal Reserve President Austan Goolsbee warned that the new tax proposal could cause inflationary pressure and reduce economic growth in the current context. This would make it more difficult for central banks to maintain stable monetary policy.
Still Remaining a Global Asset
Despite the volatility, Bitcoin continues to demonstrate its growing presence in the global financial markets. With a market capitalization of $2.16 trillion, Bitcoin has now surpassed the New Taiwan Dollar (TWD), entering the group of the world's most influential currencies.
Notably, crypto-related stocks such as Coinbase (COIN) have surged in price after being added to the S&P 500 index, while Strategy announced plans to buy an additional $2.1 billion in Bitcoin, demonstrating the long-term confidence of large investors in this digital asset.
Despite facing short-term policy shocks, Bitcoin is still on the journey to affirm its role as a strategic macro asset. In the context of increasing geopolitical volatility, BTC's resilience and long-term appeal can continue to play a pivotal role in the investment portfolios of both individuals and institutions globally.
