Analysts are warning that the US is heading for a ‘Black Monday’ after a sudden $1.3 trillion crypto meltdown.
Cryptocurrency prices have faced a sharp decline following the stocks that plummeted in the wake of President Donald Trump’s tariff announcements.
While last week, Bitcoin was sitting at around $90,000, it has now plunged below $77,000.
And the entire crypto market has seen a whopping $1.3 trillion taken from its value.
Advert
Now, experts fear that this could result in a full blown crash of the market.
Charlie Sherry, who is the head of finance and crypto analyst at BTC Markets, spoke to Forbes where he said: “Bitcoin has recently lost the key $79,000 to $80,000 support level, which it had managed to hold for the past month.
“This support level had marked the bottom of the range after the all-time-high pullback. The next key support lies around $72,000, which was the pre-election high.”
Geoffrey Kendrick, Standard Chartered Bank’s head of crypto, added: “Sometimes crypto movements on Sunday tell you what stocks are going to do Monday. If that is the case, Monday could be ugly.”
On Friday, the UK’s FTSE 100 had its worst day of trading since the early days of the pandemic, with firms set to suffer significant losses.
Jim Cramer, market analyst and CNBC host, has also warned that the US could be heading for a financial disaster.
Black Monday described the crash in 1987 where stocks saw a 22.6% drop in just one day and there are now fears that we could be facing a similar situation.
During his show on Saturday, Cramer said: “If the president doesn't reach out and reward countries and companies that follow the rules, then the 1987 scenario… where we dropped for three days and then plunged 22% on Monday, becomes highly relevant.”
Since then, the crypto market has been experiencing sharp losses as of this morning (April 7).
A whopping $250 billion has been wiped from the entire global cryptocurrency market cap.
This is a 9.29% decline since Trump first announced his global tariffs last Thursday (April 3).
JP Morgan has predicted that there is now a 60% chance of a global recession happening before the end of the year.
In a note, the brokerage said: “Disruptive US policies have been recognized as the biggest risk to the global outlook all year.
“The effect ... is likely to be magnified through (tariff) retaliation, a slide in US business sentiment and supply-chain disruptions.”