Ether (ETH-USD), the second-largest cryptocurrency, led a fresh sell-off in digital assets on Wednesday, following US President Donald Trump’s firm stance on imposing 104% tariffs on numerous Chinese imports. This move dimmed expectations for avoiding a severe trade war, further rattling financial markets.
Ether plunged more than 6%, reaching its lowest intra-day level since March 2023. It later trimmed some losses and was trading at $1,432 at 9:51 a.m. in Singapore. Bitcoin (BTC-USD), the largest cryptocurrency by market capitalization, fell more than 3% before recovering slightly.
On Tuesday, Trump and senior officials from his administration suggested the US might be willing to negotiate deals that could reduce or remove the elevated tariffs on goods from several countries. However, the announcement sent Asian stock markets into a downward spiral, exacerbating existing financial market instability.
“It seems like people have given up on a major recovery in crypto during the first half of the year,” remarked Sean McNulty, head of APAC derivatives at FalconX, a digital-asset prime brokerage.
As the cryptocurrency market took a hit, traders sought downside protection for Ether and Solana by purchasing put options in large quantities. McNulty also indicated that Bitcoin’s next significant support level is approximately $65,000.
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