Trump’s renewed trade war led to a disruption in the recent upward trajectory of the crypto market, leading to a Bitcoin drop below $90,000.
On January 20, the day that marks one year since Trump’s inauguration as the new President of the US, the general crypto market is down by over 3%, with a market cap of $3,04 trillion.
Trump’s trade war is back
Recently, Trump announced new tariffs on the EU, confirming his main strategic priority to acquire Greenland. His plans include a new 10% tarfiff on Denmark, Norway, Sweden, France, Germany, the UK Netherlands, and Finland, starting on February 1st.
These tariffs are set to increase by 25% on June 1st, and will reportedly not be lifted until a deal is reached regarding Greenland. Trump said that this deal must be “a complete and total purchase of Greenland”.
The Kobeissi Letter analyzed the trade war from the past year, noting how tariffs are back when markets are pumping and expecting it the least.
The most recent and noteworthy event was on October 10, when Trump threatened a 100% tariff on China beginning November 1st. This date marked the latest significant collapse of the crypto market, when Bitcoin fell sharply amidst huge crypto liquidations of over $19 billion.
These moves are part of a tariff playbook, and Trump uses these threats as part of a negotiation technique. In October, the tariff threats ended with a trade deal with China.
Trump made the EU tariff threats this Saturday, January 17, ahead of a US holiday on January 19, marking Martin Luther King Jr. Day. Futures markets were closed yesterday, and the market reaction came today, January 20.
Important key points about Trump’s tariff playbook
The Kobeissi Letter highlighted important key points about this tariff playbook, noting how Trump posts a cryptic message signalling upcoming tariffs ahead or during the weekend, leaving markets to react after a pressure buildup and a rise in psychological impact.
They also describe the trader sentiment during the next week following the tariff announcement, ahead of an eventual solution between Trump and the leaders of the countries targeted by tariffs.
Over the next 2 to 4 weeks, usually a trade deal is announced, and markets resume their upwards trajectory, hitting a new ATH.
The end goal is always the same – Trump wants to reach a deal, and such tariffs never actually go into effect.
EU leaders respond to Trump at WEF meeting
During the World Economic Forum at Davos, French President Macron criticized Trump’s tariff moves that have opposed a US takeover of Greenland, saying that the US President wants to weaken and subordinate Europe, The Guardian reported.
Meanwhile, Ursula von der Leyen also highlighted that the EU and the US have already agreed to a trade deal in July 2025.
The crypto markets are currently going through volatilty during this trade war period, but will hopefully recover when it’s over.
Bitcoin price trajectory
At the moment of writing this article, BTC is trading above $90,000, following a short-lived drop below the level. BTC is down by 3% in the past 25 hours, after trading above $95,000 on January 19.
Ahead of the recent volatilty, BTC was on an upward trajectory reaching prices over $97,000 on January 14, and triggering hopes of a new ATH.
Bitcoin adoption continues
However, we expect Bitcoin to recover, amidst rising global adoption, institutional interest, and notable acquisitions by BTC-centric companies.
On January 20, Michael Saylor announced that Strategy has acquired over $2,1 billion in BTC, raising total holdings to 709,715 BTC worth over $64 billion at current prices.
Strategy has acquired 22,305 BTC for ~$2.13 billion at ~$95,284 per bitcoin. As of 1/19/2026, we hodl 709,715 $BTC acquired for ~$53.92 billion at ~$75,979 per bitcoin. $MSTR $STRC https://t.co/pJM0Yuy32w
— Michael Saylor (@saylor) January 20, 2026
Despite the market volatilty, the industry should maintain optimism amidst strong Bitcoin and crypto adoption worldwide.
