In an unexpected turn of events, the largest cryptocurrency in the market, Bitcoin, has failed to hold the crucial $80,000 level of support and nosedived below it, losing nearly 10%. BTC plummeted from $82,650, reaching a local bottom at the $74,670 level. At the moment, thanks to a small rebound, Bitcoin has moved a little higher, now trading at $78,690, but still unable to recover the $80,000 mark so far.

Black Monday sell-off strikes stocks and Bitcoin

This deep price correction plunge took place as Bitcoin continued to react to the trade tariffs implemented by the US president on Friday and deepened as trade tensions between the US and China began escalating today. All the crypto market followed Bitcoin deep into the red zone as the bloodbath hit the crypto space. Thus, Bitcoin has proved that it has not yet managed to decouple from the stock market and its leading indexes – Nasdaq, S&P 500, and Dow Jones, which lost more than $5 trillion after staggeringly large sell-offs in just two days last week.

Famous financial commentator from CNBC, Jim Cramer, published a bearish forecast over the weekend, stating that the markets may see a “Black Monday” sell-off coming, similar to that of 1987. The last time a similar thing happened was March 2020, when a “Black Thursday” followed by a “Black Friday” took place, when crude oil briefly crashed below zero and Bitcoin dipped under $4,000.

Trump’s new tariffs and threats to China shock markets

Today’s sell-off was triggered by the second round of aggressive trade tariffs imposed on almost 200 countries by US President Donald Trump. A month after the first tariffs were implemented against Canada, Mexico, and China, the president has laid tariffs on all goods entering the US market from all countries, except Russia and Belarus. Several countries have already begun negotiations with Trump about the removal of those tariffs – Vietnam and Cambodia. China has asked the US for negotiations too. The EU intends to offer the US an exchange: European zero tariffs on US produce against US zero tariffs on European goods.

Besides, Donald Trump has threatened to impose an additional 50% fee on Chinese goods on April 9 unless by April 8 China has removed the 34% trade fees on US goods. Besides, in this case, Trump will cancel all the talks with China about the negotiations they have requested. This development has sent shockwaves through global markets, worsening the sell-off of all assets, except gold, and including Bitcoin.

A vocal Bitcoiner Michael Saylor, head of Strategy, commented on that, saying that people are selling Bitcoin now since it was meant to be the most liquid asset on earth. This way, BTC is justifying this status and is crashing alongside stock indexes.

Bitcoin’s correlation with stocks re-emerges

For several months, Bitcoin seemed to be strong enough to defy macroeconomic pressure and stand well against the market turmoil. As stocks began to decline due to the rising inflation data and geopolitical tensions, BTC succeeded in holding first slightly below the $90,000 level and then gradually falling. However, it managed to hold in the range between $81,000 and $84,000 as it was enjoyed interest from financial institutions and major inflows in spot Bitcoin ETFs.

Now, something has radically changed. The correlation between BTC and stocks and equities has emerged once again and is stronger than it was before. Many traders, including the Barstool president Dave Portnoy, have questioned why Bitcoin, which was meant to be “digital gold,” is sinking like a rock alongside stocks, and if it has become weak and sensitive to strong market headwinds. The aforesaid comment of Michael Saylor was a response to Portnoy’s remark.

Gold surges to new all-time high

Among the current market turmoil, one traditional asset that has been considered a safe haven for much longer than Bitcoin has quickly spiked in value, reaching a new all-time high above $3,100 – gold. As uncertainty keeps spreading over markets, gold is showing investors once again that it indeed has the right to be called a safe haven asset.

Some investors, though, are betting on gold and Bitcoin simultaneously, such as Robert Kiyosaki, who is known as the author of the “Rich Dad Poor Dad” book on how to manage personal funds. In his tweets, he constantly touts gold, silver, and Bitcoin as the only three reliable and real assets, opposing them to “fake” assets made by Wall Street, including Bitcoin ETFs. In today’s tweet, he said that he intends to continue buying all three. And last week, he even proclaimed that silver has more potential than Bitcoin and gold, since industrial demand for silver continues to grow exponentially. Still, the majority of investors are selling Bitcoin and buying gold.

Now that Bitcoin is hovering above $78,000, investors are expecting volatility to worsen and are watching the next moves Trump decides to take. They are also keeping a watchful eye on what response China will give Trump this week. That may put more selling pressure on stocks and Bitcoin.