The crypto market continued its downward slide this week as worries over a potential trade war and disappointment over the president’s national crypto reserve hit coin prices. And a recent Trump interview about a possible recession certainly isn’t helping.
Bitcoin has fallen nearly 5% in the last 24 hours to less than $80,000, its lowest price since mid-November. Other cryptocurrencies also fell on Monday as investors continued to flee risk-on assets. XRP is down 4% in the last 24 hours, Solana is down 7%, and Cardano is down 8%.
The president has imposed and partially removed aggressive tariffs on Canada, China, and Mexico in recent weeks, effectively starting a trade war between the U.S. and those three countries. When asked in a Fox News interview on Sunday if his aggressive tariff policy could trigger a recession this year, Trump responded that the country will experience a “period of transition.”
“Adding to the uncertainty, Trump, in a newly aired interview, declined to rule out the possibility of a U.S. recession this year,” Jake Ostrovskis, an over-the-counter trader at market maker Wintermute, told Fortune, adding that the president reiterated his view that “short-term economic pain is likely.”
The tariffs are expected to increase inflation and drive up the prices of foreign goods, pushing investors toward investments that are less risky than crypto, which is known to be extremely volatile. But the open opining about a recession this year was particularly worrisome to investors.
The latest comments follow closely on the heels of disappointment with a White House plan for a national crypto reserve. Many crypto enthusiasts expected Trump’s national crypto reserve plan to include large government purchases of Bitcoin and other cryptocurrencies, which would increase demand and drive prices up. However, investors were let down last week when Trump announced that the government would not purchase additional crypto and would instead only retain cryptocurrencies seized from illicit activities.
“While formalizing a Bitcoin reserve is a milestone, it doesn’t create immediate buying pressure, disappointing those expecting aggressive accumulation,” Haider Rafique, a global chief marketing officer at crypto exchange OKX, told Fortune in a statement.
While the outlook for risky assets was looking positive after Trump was elected in November, the crypto market has lost 25% of its total market cap since the Federal Reserve announced in December that it would not make as many interest rate cuts in 2025 as in 2024.