Trump's tariff threat leads to Bitcoin weakness 'again', shaking the digital gold narrative again

Bitcoin has emerged as a victim of market uncertainty ‘again’. After President Trump’s threat of tariffs on Greenland, the cryptocurrency market as a whole has recorded a significant drop, and Bitcoin (BTC) has been losing its safe-haven status “again” in recent transactions. As of the latest data, the price of BTC has fallen by 5.09% in 24 hours from the $84,870 level.

Tariff threat puts Bitcoin in a bearish phase ‘again’

Tensions are hovering in the market. After former President Trump vowed to impose new 10% tariffs on Denmark and seven European countries amid the conflict over Greenland, the cryptocurrency market, including Bitcoin, recorded a wide range of declines. According to CoinDesk data, Bitcoin once fell to near $92,000, and major industry indices (memecoins, metaverse, computing, DeFi, and culture and entertainment indexes) also fell by more than 7% each.

This drop was not just a price adjustment. As geopolitical tensions intensified as the European Union (EU) strongly opposed its commitment to protecting Greenland’s sovereignty, traders began to reevaluate Bitcoin as a “risky asset.” Paradoxically, while gold soared to record highs and played the role of a typical safe-haven asset, Bitcoin showed a wavering performance along with the stock market.

The probability of reaching $100,000 at the end of January plummeted ‘again’

Polymarket’s forecast market data clearly shows changes in market sentiment. On decentralized betting platform Polymarkets, contracts indicating BTC’s probability of reaching $100,000 by the end of January have plummeted. It fell from about 50% on Friday to 27%, and compared to 72% on January 15, it can be seen that investor sentiment has shrunk significantly.

Sameer Hassan, senior market analyst at XS.com, pointed out that “Bitcoin has retreated from its highest level since November after five consecutive days of decline, and is struggling to maintain the $92,000 support level.” He analyzed that this decline is not just profit-taking, but a process in which traders digest the “risk-off” shift due to the surge in US political risks and the intensification of geopolitical and trade tensions.

Institutional investors show confidence ‘again’

Interestingly, Bitcoin and Ethereum spot ETF flows remain positive. Before last week’s controversy, Bitcoin spot ETFs had inflows of more than $1.4 billion, while Ethereum spot ETFs had inflows of more than $500 million, recording the strongest inflows since October. This suggests that institutional investors maintain long-term interest despite short-term volatility.

In addition, the number of so-called whale bulk holding wallet addresses (holding 1,000~10,000 BTC) increased by 28% in the last week. This trend, according to BGeometrics data, suggests that institutions and large investors may be seeing bearishness as an opportunity.

Variables to watch next week - Tariffs and economic indicators

Laser Digital pointed out that “short-term price movements depend on how this US-EU tariff risk develops.” The company added that “persistent geopolitical risks in the Middle East also remain.”

The variables that traders should pay attention to ‘again’ have already been determined. The Davos Forum, the release of the US GDP, key personal consumption expenditures (PCE) data, and the Supreme Court’s ruling on the legality of Trump’s tariffs are the main schedule this week. If any of these events turn out differently than expected, the volatility of Bitcoin’s price could increase.

In the end, whether Bitcoin can function as “digital gold” depends on the macro environment “again”. While the confidence of institutional investors and the buying movement of large investors are clearly positive signs, short-term volatility seems inevitable unless the uncertainty of tariff policy is resolved.