Bitcoin’s value tumbled nearly 10 percent on Monday, as investor anxiety over an escalating trade war and uncertainty surrounding a proposed U.S. cryptocurrency reserve fund triggered a wave of sell-offs across digital assets.
Late in the day, Bitcoin was trading at $85,321, down 9.47 percent, while Ether, the second-largest cryptocurrency, suffered an even steeper decline of over 15 percent. Other major digital assets, including XRP, Cardano, and Solana, saw their values drop by almost 20 percent.
The sell-off came after U.S. President Donald Trump floated the idea of a national cryptocurrency reserve fund on Sunday, naming Bitcoin, Ether, XRP, Cardano, and Solana as potential assets for inclusion. The announcement initially fueled a surge in crypto prices, but skepticism quickly set in as investors questioned the feasibility of the plan.
Adding to market jitters, Trump confirmed a 25 percent tariff on all imports from Mexico and Canada, prompting both nations to vow retaliation. Analysts say fears over a widening trade conflict, combined with concerns about slowing U.S. economic growth, further weighed on investor sentiment.
The proposed cryptocurrency reserve fund would be formed using digital assets already in U.S. possession, primarily those seized in legal cases or belonging to sanctioned individuals or entities. However, skepticism remains over whether such a reserve could pass through Congress.
Coinbase CEO Brian Armstrong voiced reservations about the inclusion of multiple cryptocurrencies in the reserve, advocating instead for a Bitcoin-only approach. “It’s the simplest, and there’s the idea that it could be a successor to gold,” Armstrong wrote on X.
By mid-afternoon, Bitcoin had rebounded slightly to $86,700, barely above its pre-Trump announcement levels. Ether, meanwhile, hit a new five-year low relative to Bitcoin. Other tokens named by Trump in his reserve proposal also surrendered much of their earlier gains.
Market analysts pointed to broader financial uncertainty as a key factor in the crypto downturn. Crypto-related stocks mirrored the downturn, with major players such as Core Scientific (CORZ) and Bitdeer (BTDR) posting significant losses. Meanwhile, medical equipment firm Semler Scientific (SMLR), which has invested in Bitcoin, fell 7.3 percent after news of a U.S. Department of Justice investigation into potential fraud violations.
The broader stock market also slid into the red, with the Nasdaq down 1.1 percent and the S&P 500 off 0.8 percent, as investors braced for further trade tensions and economic uncertainty.
Shogun Lin
