Crypto Market Sees Pullback Amid Rising Trade Tensions and Market Jitters
The crypto market took a step back on Friday, with major digital assets like Bitcoin and Ethereum retreating after posting strong gains earlier in the week.
Bitcoin and Ethereum Retreat from Highs
Bitcoin (BTC) saw a 4.12% drop from its weekly high, sliding to $107,300. Ethereum (ETH) wasn’t spared either, falling more than 8% from its peak. Overall, the altcoin market saw a dip in total market capitalization—from $1.28 trillion earlier in the week to $1.19 trillion.
This downturn wasn’t isolated to crypto alone. U.S. stock futures, including those tied to the Dow Jones, S&P 500, and Nasdaq 100, also fell by over 1% as broader market concerns weighed on investor sentiment.
Geopolitical Tensions Fuel Market Uncertainty
The sell-off coincides with renewed concerns over global trade. In a post on TruthSocial, former President Donald Trump declared that trade negotiations with the European Union had stalled, threatening to slap a 50% tariff on all EU imports. The EU has responded in kind, signaling possible retaliatory tariffs on American products, including Boeing aircraft.
This tit-for-tat rhetoric escalates tensions at a time when markets are already jittery. Ryanair’s CEO warned the airline might cancel a massive $33 billion Boeing order if the trade war heats up, opting instead for Airbus.
These developments come just one week after Moody’s downgraded the U.S. credit rating and the House passed a bill projected to add $3.8 trillion to the national debt over the next decade.
Is the Bull Market in Crypto Over? Not So Fast.
Despite this week’s pullback, there are several reasons to believe the crypto bull run is far from over:
- Political Posturing Over Policy: Trump’s tariff threat is likely a negotiation tactic. We’ve seen similar moves with China, where tariffs initially hit 145% before being scaled back to 30% earlier this month.
- Bitcoin as a Safe Haven: With over $8 billion flowing into spot Bitcoin ETFs since April, institutional demand remains strong. As supply across exchanges dwindles, Bitcoin continues to solidify its reputation as a digital safe haven.
- Healthy Corrections Are Part of the Cycle: Market pullbacks are natural. Earlier this year, Bitcoin dropped from $109,300 to $75,000 before rebounding. Similar patterns played out in 2024, with significant corrections followed by new highs.
With strong fundamentals and increasing institutional interest, this week’s dip may just be a pause—not a pivot—in the broader upward trend.
