Cryptocurrencies Set to End the Week with Sharp Losses
Amid heightened global risk aversion, cryptocurrencies remain on edge as new announcements from Donald Trump loom, further strengthening their correlation with U.S. equities.
The crypto market is experiencing a period of volatility, with major assets heading for steep losses this week.
Bitcoin (BTC) is seeing a slight uptick, trading around $84,800 on Binance, though it has lost 6% over the past week. Meanwhile, Ethereum (ETH) is at $1,901.94, marking a 12.8% decline in the last seven days.
Altcoins are also closing the week with heavy losses:
Declining Confidence in Risk Assets
Bitcoin’s dominance in the total crypto market capitalization has surged to 62.5%, its highest level since March 2021, according to TradingView. This figure has climbed from 55% to 62% since the market peak of $3.6 trillion in December. A rising dominance index often signals reduced investor confidence in riskier assets amid market turbulence.
Macroeconomic Uncertainty Weighs on Markets
On the macroeconomic front, uncertainty remains high. The U.S.-China trade war escalated further after the Biden administration imposed 25% tariffs on steel and aluminum imports, prompting retaliatory measures from Canada and the European Union. Trump’s trade policies are adding to market tensions.
The big question is how far Trump will go with tariffs and government spending cuts. While it may be exaggerated to assume he’s deliberately pushing the economy into a recession, his commitment to reshaping global trade cannot be underestimated.
Meanwhile, the latest U.S. inflation data has done little to ease market concerns. According to the Bureau of Labor Statistics, the February Consumer Price Index (CPI) dropped to 2.8% in headline inflation and 3.1% in core inflation—both better than expected. However, analysts warn this could be “the calm before the storm.”
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