Bitcoin Tumbles Under $100K as Market Fears Trade War Impact

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Cryptocurrency prices fell as concerns over a potential global trade war spooked investors, leading them to shy away from riskier assets.

Bitcoin dropped by more than 4% early Monday morning in Asia, hitting a three-week low around $96,606. Meanwhile, ether, a smaller cryptocurrency, tumbled by about 12%, reaching levels not seen since early November. 

Over the weekend, U.S. President Donald Trump announced 25% tariffs on imports from Mexico and most Canadian goods, and 10% on Chinese imports, effective Tuesday.

Cryptocurrencies, which trade continuously, have recently been highly responsive to shifts in market sentiment. With fears that tariffs could harm growth and corporate profits, investors turned away from risky assets like crypto.

"Cryptocurrency has become a way to express risk, especially during weekends, and news like this makes it a proxy for risk sentiment," explained Chris Weston, head of research at Pepperstone.

Additionally, downward pressure on cryptocurrencies has been building after a strong rally post-Trump's election, as some investors have been disappointed by the lack of immediate changes to crypto policy or regulation since his administration took office.

Paraphrasing text from "Reuters" all rights reserved by the original author.