Global crypto prices are showing signs of recovery, yet uncertainty continues to shadow the market. Following new tariffs announced on Feb 3 by President Donald Trump on imports from China, Canada, and Mexico, cryptocurrencies experienced heightened volatility earlier this week.
Despite a rebound in key assets, growth prospects remain murky as investors weigh geopolitical risks and technical indicators.
Crypto Prices Plummeted Followed by a Volatile Recovery
On Friday, President Donald Trump signed tariffs targeting the two North American countries, triggering a market-wide sell-off. Bitcoin (BTC) plunged from $98,000 to $91,000, wiping out leveraged positions at an unprecedented scale.
According to CoinGlass, total liquidations reached $2.27 billion, while ByBit estimates the figure was significantly higher at $8-$10 billion. On ByBit alone, traders lost $2.1 billion within a single day.
On February 3, markets saw a partial rebound after Trump paused the Mexico and Canada tariffs for one month, bringing temporary relief. Crypto prices added 3.3% in 24 hours, with Bitcoin recovering to $102,000, but selling pressure persisted.
Just as markets regained stability, China retaliated with its own tariffs against the United States, sending another shockwave through global markets. The news triggered a fresh round of volatility, keeping investors on edge.
The Crypto Fear & Greed Index reflected the market’s uncertainty, plummeting from 72 to 44 on February 3 before bouncing back. The sharp swings highlight crypto prices’ sensitivity to macroeconomic policies and international trade disputes.
Ethereum (ETH) failed to hold above its 200-day moving average, trading near $2,700 as it re-entered its August-October 2023 consolidation zone.
Often viewed as the “canary in the crypto market,” ETH’s weakness signals broader uncertainty. Unlike Bitcoin, ETH has struggled to attract fresh capital, with CoinShares reporting a $0.3 million outflow from Ethereum investment products last week.
Record Liquidations and Institutional Flows
The liquidation event overshadowed a strong week for institutional investments. CoinShares reported that global crypto funds attracted $527 million, with Bitcoin leading at $486 million.
Among altcoins, XRP received $15 million in inflows, making it the second-best-performing crypto this year with $105 million in total inflows. Solana (SOL) saw $5 million in inflows, while Ethereum was the only major asset to see outflows.
Adding to market uncertainty, MicroStrategy—the largest corporate holder of Bitcoin—paused BTC purchases last week for the first time in 12 weeks. The company currently holds 471,107 BTC, acquired at an average price of $64,511 per coin.
Kimchi Premium Hits 3-Year High
Meanwhile, in South Korea, the ‘kimchi premium’—a measure of Bitcoin’s overpricing on Korean exchanges—spiked to 11.9% on February 3, its highest level in three years.
The premium typically stays below 5%, signaling increased demand from Korean retail traders despite global uncertainty.
India Reconsiders Crypto Stance
As global markets adjust to policy risks, Reuters reports that India is reconsidering its stance on digital assets, driven by changing international policies. This shift could have significant implications for the global crypto landscape.
The past week highlights how macroeconomic events shape crypto price action. Bitcoin’s break above the 50-day moving average and Ethereum’s struggles underscore the market’s fragility.
The post Market Update: Crypto Prices Recover, but Growth Stays Murky appeared first on The Coin Republic.
The Coin Republic – Read More