Bitcoin’s price fell after U.S. President Donald Trump announced an immediate 15% global tariff hike on February 21st. The cryptocurrency briefly pushed toward $68,000 before the rally faded, with broader market sentiment turning to “extreme fear.” Experts note Bitcoin is reacting as a high-beta liquidity proxy to hawkish monetary policy, though long-term historical data suggests potential for significant recovery.
Bitcoin attempted to hold steady but ultimately declined following a new trade policy from U.S. President Donald Trump. The President announced an immediate increase in global tariffs to 15% on February 21st, a move that followed a court decision limiting his emergency powers.
Bitcoin initially rallied toward the $68,000 mark around the announcement before retreating lower. Ethereum also turned lower, while the altcoin market tracked by TOTAL3 dipped approximately 0.29%.
Wenny Cai, COO at SynFutures, told reporters that “Crypto is reacting like a high-beta liquidity proxy.” Cai added, “Markets are digesting a more hawkish read-through from the latest Federal Reserve minutes… Equities have softened and the bid has moved back toward cash-like instruments.”
Market sentiment deteriorated sharply, with the Fear and Greed Index falling to levels indicating “extreme fear.” This reflects investor caution and expectations of further downside pressure across digital assets.
However, historical analysis provides a counterpoint to the current pessimism. Economist Timothy Peterson recently noted in an X post that Bitcoin’s long-term outlook remains hopeful based on performance since 2011.
According to Peterson’s analysis, when at least half of the preceding two years were positive, Bitcoin traded higher 10 months later roughly 88% of the time. On average, returns during those periods reached as high as 82%, with Peterson’s model suggesting a potential climb toward $122,000 from current levels.
