XRP and Dogecoin Plunge

XRP and Dogecoin (DOGE) plunged over 10%, leading losses among major cryptocurrencies as the confirmation of fresh U.S. tariffs on China impacted Asian markets on Friday, adding to an already tumultuous week for cryptocurrencies.

Bitcoin and Other Cryptocurrencies

Bitcoin (BTC) dropped 7% to near $79,000 for the first time since November, down nearly 30% from its January peak of over $108,000. Ether (ETH), Cardano’s ADA, and BNB Chain’s BNB experienced similar declines, each dropping at least 9%.

Overall market capitalization fell 8% to $2.7 trillion, reversing all gains made since U.S. President Donald Trump was elected in early November. The broad-based CoinDesk 20 (CD20) index dropped nearly 9%.

A solid earnings report from Nvidia on Wednesday was insufficient to counteract market pessimism, as global equities faltered due to renewed tariff concerns, a slowing economy, and overstretched positioning. This downward trend has inevitably spilled over into the crypto space, given Bitcoin’s high correlation with the S&P 500 index, traders noted.

Augustine Fan, head of insights at SignalPlus, commented, “On a YTD basis, ex-BTC tokens and trading sentiment have struggled mightily. Liquidity has been depleted from numerous memecoin runs, and BTC has also buckled under the weight of ETF selling, which reached a record high last week.”

Impact of U.S.-China Tariffs

Friday’s losses in the crypto markets reflected those of Chinese stocks, which dropped after Trump announced a 10% tariff on Chinese imports. This development raised concerns about a growing trade war between the U.S. and China, the world’s two largest economies.

The new tariff builds upon an existing 10% tax on Chinese goods initiated earlier this month. This could negatively affect China’s economy, which is already grappling with a property crisis and declining prices. It might also hinder a stock market rise driven by advancements in AI, exemplified by ChatGPT rival DeepSeek.

The tariff announcement comes ahead of China’s significant annual meeting, the National People’s Congress, which is set to commence next week. At this meeting, leaders are expected to outline economic plans and growth objectives.

A decision by China to increase spending or encourage buying to stimulate the economy could affect Bitcoin and crypto prices and act as a market catalyst — making it a critical data point to monitor in the coming week.

Bearish Sentiment Prevails

Nevertheless, the mood remains bearish among some Bitcoin traders. “Bullish option speculators are throwing in the towel, with volatility decreasing as lower spot prices lead to a dump of call options in favor of puts,” Fan remarked.

Concerns over MicroStrategy (MSTR) dropping 10% also add extra risk to BTC, given their convertible funded buying, pushing bearish sentiment to near-term extremes across many technical indicators.