Cointelegraph reports a surge in Bitcoin’s volatility, set against the backdrop of the impending trade war and the proposed US cryptocurrency reserve. Data from TradingView and Glassnode highlight the rollercoaster ride of crypto prices sparked by the contradictory bullish and bearish signals that escalated post the inauguration of US President Donald Trump.
Over the past two weeks, the crypto market has seen tumultuous conditions amidst an uncertain political environment. “The abrupt price fluctuation signifies this turbulence,” observes Glassnode in a research note issued in March.
Bitcoin’s realized volatility, a metric for daily price fluctuations, has recorded some of the highest values in this cycle, exceeding 80% on one- and two-week timeframes, as per Glassnode. The average true range (ATR) of the digital currency, a different volatility indicator, has reached a cycle peak of over 4,900, a significant increase from around 3,000 in late February, as indicated by TradingView data.
As of March 5, Bitcoin has witnessed almost a 30% slump from its December highs of approximately $109,000, the highest spot price ever recorded for the cryptocurrency. Altcoins, including Ether and Solana, have also suffered, dropping more than 50% from their highs, reports Glassnode.
On March 4, President Trump introduced a 25% tariff against major trade partners, Canada and Mexico. This bearish news came as a surprise for traders who were optimistic following Trump’s announcement on March 2 about the creation of a US crypto reserve featuring tokens like BTC, ETH, XRP, and Cardano.
Consequently, Bitcoin’s price fell to about $82,000 from a high of around $93,000 on March 3, according to Google Finance data. Other altcoins like ETH and SOL experienced even steeper drops, falling approximately 12% and 20% respectively.
The recent sell-off indicates that macroeconomic factors could potentially overshadow positive developments in the crypto industry, such as the dismissal of several lawsuits against crypto firms by the US Securities and Exchange Commission in February.
On March 4, cryptocurrency derivatives traders faced more than $1 billion in liquidations due to the extremely volatile spot prices.
