Crypto markets kicked off the week with heightened volatility after US–EU trade tensions escalated. Over the past few hours, markets have reacted sharply to Europe’s retaliation against Donald Trump’s weekend tariff announcement, with the crypto market shedding around $115 billion dropping to $3.21 trillion as Bitcoin slipped below $92,000 on some exchanges.
Trump’s 10% tariffs on eight European countries prompted an emergency EU summit, where French President Emmanuel Macron reportedly urged the bloc to deploy its so-called “trade bazooka,” a mechanism that could restrict US access to European markets.
Further market swings could come from economic data this week. In the US, markets were closed Monday for Martin Luther King Jr. Day, possibly delaying reactions. Key reports, including third-quarter GDP and November’s delayed PCE inflation data, are due Thursday. Policymakers will watch inflation closely, following last week’s CPI report, as the Federal Reserve prepares for its upcoming meeting amid divided opinions on rate cuts.
In Asia, central bank rate decisions in China (Tuesday) and Japan (Friday) will be closely monitored. Around 10% of S&P 500 companies report earnings this week, and the World Economic Forum in Davos also kicks off, adding to market uncertainty.
Crypto Market Moves
Bitcoin has diverged from gold again, falling more than $3,500 in early Asian trading Monday. After consolidating near $95,000 over the weekend, BTC dropped nearly 3% to a weekly low of $92,280 and was struggling to recover at the time of writing. Ethereum saw similar losses but managed to stay just above $3,200.
Altcoins were hit even harder, with XRP, Solana, Dogecoin, and Cardano all down significantly. Monero was a notable exception, rising 10% to $615.
