Key Points:
- There is now a 22% chance of Bitcoin (BTC) dropping to $75,000 by the end of March.
- This probability has doubled from a previous 10% just a week ago.
There is an observable rise in the likelihood of Bitcoin’s price dipping to $75,000 according to Derive’s on-chain options market, attributed to heightened trade war tensions between the United States and its primary trading partners including Canada, Mexico, and China. This situation threatens global inflation, complicating the ability of central banks, like the Federal Reserve, to reduce interest rates.
This surge in probability follows renewed tariffs imposed by Trump, consisting of 25% on imports from Mexico and Canada, and 10% on Chinese goods, which are anticipated to increase inflation and possibly weaken investor confidence in cryptocurrency markets. As indicated, Bitcoin has already seen an 11% decline, trading at $93,700 within the last four days.
“The recent tariffs imposed by Trump are likely to lead to increased inflation, which could dampen investor sentiment in crypto markets,” Derive commented in an email.
Andre Dragosch, the head of Europe at Bitwise, emphasized on X that tariffs are sending shockwaves through USD strength and reducing the global money supply.
Additionally, the outlook remains positive for Bitcoin with the potential for spot ETF approvals for various assets that could spur significant investment in the digital asset market, leading to price increases.
According to Dragosch, the Federal Reserve might need to intervene to maintain stabilizing asset prices.
