The crypto market is once again under pressure. The reason is tough signals from the U.S. about its readiness to return to trade wars. The statements were made at the World Economic Forum in Davos and quickly changed investor sentiment.
U.S. Treasury Secretary Scott Bessent confirmed: tariffs remain a key tool of the Donald Trump administration’s foreign policy. Markets took this as a direct hint at rising inflation risks and tighter financial conditions.
Against this backdrop, bitcoin fell below $90,000. Ether could not hold the $3,000 level. Altcoins dropped even more — investors quickly switched to risk-off mode.
Tariffs Are Not an Extreme Measure but a Permanent Lever of Pressure
Speaking at the World Economic Forum in Davos, Bessent made it clear: tariffs are seen not as a temporary measure, but as a full-fledged tool of pressure. His words came amid tensions between the U.S. and Europe.
He urged partners ‘not to rush with retaliatory steps’ and allowed for escalation if resistance increases. The market saw this as confirmation that trade conflicts could reach a new level in the coming weeks.
Moreover, Bessent specified concrete deadlines. According to him, as early as February 1, the U.S. may introduce 10 percent tariffs if Denmark and its allies refuse to make concessions on the Greenland issue.
Inflation Back in the Spotlight
A separate emphasis was placed on the economic consequences. Bessent rejected concerns that tariffs would hit the domestic market and stated that they are already bringing hundreds of millions of dollars to the budget.
However, research by European and American economists suggests the opposite. The main burden falls on consumers. In essence, tariffs work as a hidden consumption tax and gradually squeeze household liquidity.
This is critical for the crypto market. Reduced free funds and rising prices directly decrease the inflow of capital into high-risk assets. That is why digital currencies react faster than traditional markets.
Rate Volatility Increases Pressure
Bessent tried to shift the focus by pointing to sharp moves in the Japanese bond market. According to him, it is difficult to link rising yields solely to U.S. policy.
But traders look more broadly. New tariff threats, geopolitical tensions, and rising rate volatility — a combination that has historically weighed on the crypto market. Bitcoin losing the $90,000 level became a signal for many to cut positions.
Altcoins suffered the most. This is a typical picture in a phase of declining risk appetite.
Familiar Scenario for Crypto
What is happening is reminiscent of past episodes when tariff statements drained liquidity without causing an immediate economic downturn. It is precisely because of such factors that the market remained sideways for a long time after the autumn wave of liquidations.
In Davos, this risk has come to the forefront again. Despite statements about the strength of the U.S. economy, investors heard the main message — a course of pressure and uncertainty. Trade and inflation risks are back on the agenda. The crypto market, as before, is one of the first to react and is already pricing in this scenario.
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