CoinDesk 20 Index: 3,147.76 -10.03%
Bitcoin (BTC): $95,509.78 -2.69%
Ether (ETH): $2,622.71 -14.06%
S&P 500: 6,040.53 -0.5%
Gold: $2,802.67 +0.14%
Nikkei 225: 38,520.09 -2.66%

Bitcoin has fallen by over 6% since Friday afternoon on fears of a developing import tariff war between the U.S. and its biggest trading partners: Canada, Mexico and China. The tariffs fueled concerns over inflation and may make it difficult for central banks, including the Fed, to cut interest rates. Bitcoin dropped as low as $92,770 early in the Asian morning before tracking back up north of $95,000. Some observers have previously flagged the risk of bitcoin dropping to $75,000, which now looks more likely as BTC appears on track to complete a double top reversal pattern. On-chain options market on Derive.xyz indicates a 22% probability of prices falling to $75,000 by March 28, a notable rise from last week's 10%.

Ether witnessed a significant spike in volatility following the broad-based risk aversion in financial markets. The price of ether tanked as much as 24%, with considerable dislocations across centralized exchanges. On Deribit, the price hit a low of $2,065, compared with $2,127 on Kraken and $2,150 on Coinbase, the lowest since the Aug. 5 crash, according to TradingView and CoinDesk data. The slide was the biggest since May 19, 2021, according to CryptoQuant. The token of the Ethereum blockchain fell for a third straight day, losing 23% over the period, the most since November 2022. Ether's one-day at-the-money volatility jumped from an annualized 34% to 184% as the price dropped, Deribit options data tracked by Presto Research showed.

Major tokens slumped more than 25% in the past 24 hours, as liquidations in the futures market topped $2.2 billion, the highest this year. XRP, DOGE and ADA fell more than 25% to reverse all gains since December, reaching pre-U.S. election levels from early November. Most majors are down 40%-50% in the past month, data shows, making it one of the steepest dives in recent years. Overall market capitalization fell 12%, the most in over a year, while the broad-based CoinDesk 20 lost 10%. Futures markets reflected these losses with traders of ether-tracked products losing over $600 million in the past 24 hours, majorly in early Asian hours. XRP and DOGE bets lost a cumulative $150 million, altcoin-tracked products lost $138 million and ether-tracked futures lost $84 million.

Premiums of an infamous bitcoin trade popularized by Sam Bankman-Fried, the jailed founder of crypto exchange FTX, have popped back to significant levels during the market bloodbath caused by rising U.S. tariffs, a signal that some consider bearish in the short term.

The so-called Kimchi premium, or the difference in bitcoin prices on South Korean crypto exchanges and global bourses, rose just over 10% as BTC dropped 6% in the past 24 hours.

The arbitrage involves buying bitcoin on a global exchange and selling it on a Korean exchange for a profit in Korean won. Pocketing the actual gains is difficult due to South Korea's strict capital controls, but the premium is often used alongside other factors to gauge market sentiment.

Trading volumes on South Korean exchanges Bithumb and Upbit have dropped significantly in the past week, indicating a drop in retail trading activity. Meanwhile, balances of Tether's dollar-margined stablecoin USDT have been on the decline on both exchanges with instances of withdrawal delays.

“The kimchi premium doesn’t represent retail investors’ overbuying; rather, it appears to have risen as a passive response to the uncertainty of a strong dollar environment,” DNTV Research analyst Bradley Park told CoinDesk.

- Omkar Godbole