Last night, Bitcoin continued its nosedive, dropping to touch $76,650, currently priced at $77,600, with a 4.5% decrease in the last 24 hours, hitting a new low since November 2024.

According to Coinglass data, the Ethereum network's liquidation volume in the past 12 hours reached $765 million, with long liquidations at $674 million and short liquidations at $91.21 million.

Since March, the total market value of the cryptocurrency sector has been steadily declining, dropping to $2.6 trillion as of the time of writing, currently at $2.62 trillion, with a 7% decrease in the last 24 hours.

Investor Confidence Severely Split Under Tariff Threat

Recent intensive adjustments to tariff policies by U.S. President Trump have caused significant market turmoil. On February 1, Trump signed an executive order imposing a 25% tariff on products imported from Mexico and Canada. On February 3, Trump announced a 30-day postponement of the tariff hike on the two countries and continued negotiations. Based on this decision, the related tariff measures took effect on March 4. However, on March 6, Trump signed a tariff amendment for Mexico and Canada, exempting products compliant with the United States-Mexico-Canada Agreement from tariffs until April 2.

On March 7, Trump announced a suspension of tariffs to assist Mexico and Canada, with tariffs set to be fully reciprocated starting from April 2. "Tariffs may go up as time goes by."

Related Reading: "U.S. Stock Market Evaporates $1.5 Trillion, Cryptocurrency Market Shrinks $300 Billion, Trump Holds an Expensive Press Conference"

Despite the solid fundamentals of the U.S. economy—latest job data showing 151,000 new jobs, maintaining a historically low unemployment rate, and Federal Reserve Chairman Powell emphasizing that the economy is in a "good place"—investor confidence has severely diverged.

In an interview with Fox News, Trump stated that economic policies might cause short-term turbulence, but he believed it would drive future prosperity. "I don't like predicting things like this; what we're doing is massive, so there's a transition period." Analysts point out that the White House is trying to pressure the stock market to force the Fed to cut rates, compounded by risks of government shutdown and federal spending cuts, pushing the economy into a "stagflation trap."

Trump's chaotic tariff adjustments and significant cuts to federal spending have dimmed the outlook for the investment market. The market, which had been relying on America's strong economic performance for growth, has experienced a major reversal.

US Stock Market Plunges, Wall Street Panic Intensifies

On March 10, the US stock market saw a deep decline, with the S&P 500 index falling by 2.7%, marking the largest single-day drop this year. The tech-heavy Nasdaq index was among the major indices hit hardest by the sell-off, dropping by 4%, its largest single-day decline since September 2022. Tesla experienced its largest single-day drop since September 2020, erasing all post-election gains, while Nvidia fell over 5%. Safe-haven trading drove the defensive utility sector higher.

The US stock market faces multiple unfavorable factors, including concerns about US economic recession, escalating trade tensions, risks of a US government shutdown, market expectations of an imminent Japanese rate hike, unwinding of yen carry trades, breaches of key technical indicators, deteriorating market sentiment, and investors seeking refuge in safe-haven assets.

The ongoing three-week market sell-off has further intensified, with investors fearing that the uncertainty surrounding the chaotic tariff policy will lead to an economic recession. Citigroup analyst Drew Pettit stated, "This massive sell-off feels terrible. Our expectations for growth were high, and all this selling is just a recalibration in response to the new risks we face."

Michael Wilson, Chief US Equity Strategist at Morgan Stanley, analyzed, "If economic growth deteriorates significantly further and a recession becomes possible, the S&P index could fall another 20%." He warned, "We're not there yet, but the situation could change quickly." As risks rise, funds flow into safe-haven assets, with short-term bonds surging and Bitcoin falling to a four-month low.

Is Strategic Reserve Just Empty Talk?

Also on March 7, the crypto industry saw the long-awaited Bitcoin Strategic Reserve executive order. At around 8 a.m. on March 7, White House AI and Cryptocurrency Czar David Sacks announced on social media that President Trump had signed an executive order establishing a strategic Bitcoin reserve a few minutes earlier. However, after this huge bullish news, the price of Bitcoin unexpectedly plummeted, dropping from around $90,000 to below $85,000 within an hour. With the continued stock market decline, the price of Bitcoin naturally followed suit, falling to a low not seen since November 2023.

Related Reading: "Trump Signs Bitcoin Strategic Reserve Executive Order, Why Did the Market Instead Experience a Sharp Decline?"

David Sacks wrote in a tweet that the strategic reserve's reserve fund will be capitalized with Bitcoin owned by the federal government, specifically Bitcoin seized by the U.S. government in criminal or civil asset forfeiture proceedings. The U.S. government will not sell any of the Bitcoin deposited in the reserve, but is also unlikely to further purchase additional Bitcoin, meaning "it won't cost taxpayers a penny."

However, at the inaugural White House Crypto Summit held on Friday evening, the market did not receive good news. Instead, through a live broadcast, it announced to the world a certain level of "flattery" in the cryptocurrency market.

Meanwhile, a UK Treasury spokesperson stated, "The volatility makes Bitcoin less suitable as a reserve asset for the UK, and the UK has no plans to introduce a Bitcoin reserve similar to the United States'."

In a best-selling book "Antifragile," the author writes, "As for cryptocurrencies, Spitznagel finds the data too sparse, the noise too loud to assess accurately at this time. Taleb is more direct. He believes that Bitcoin cannot serve as a hedge for investments because it is highly correlated with the market. Just think back to the crisis in March 2020 when Bitcoin's decline exceeded the market average. This shows that it is of no value as a tool to hedge against market collapse risks."

On March 11, BitMEX co-founder Arthur Hayes posted, "The plan is as follows: Be patient, don't rush. Bitcoin may bottom around $70,000, retracing 36% from the historical high of $110,000, which is very normal in a bull market. Then, we need a free fall in the U.S. stock market, followed by bankruptcies of traditional financial giants. After that, the Fed and central banks around the world will start flooding the market. That's when you should go All in. Traders will try to catch the bottom, and if you are risk-averse, you can wait until the major central banks start flooding before increasing your position. You may not catch the exact bottom, but you won't have to suffer through a long consolidation period and potential unrealized losses."

In one word, all you can do is wait.

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