Bitcoin fell by 2.12% to 153.99 million KRW. Altcoins also experienced significant drops, with Ethereum down 8% and Ripple down 12%. The “Kimchi Premium” reached the 8% range. Despite the immediate market impact of tariffs induced by Trump being a shock, they are viewed as potentially beneficial in the long term.
On the morning of the 3rd, Bitcoin was trading at 153.91 million KRW on Bithumb, a 0.57% drop from 24 hours earlier. Similarly, on Upbit, it was down by 2.12% at 153.99 million KRW. According to CoinMarketCap, Bitcoin was trading at $97,521, a decline of 3.24% from the previous day.
Ethereum experienced greater losses; it fell by 6.39% on Bithumb to 4.51 million KRW and 7.36% on Upbit. According to CoinMarketCap, it was down 8.57% at $2,860. Other major altcoins followed this downward trend with Ripple down 12.40%, Solana down 5.58%, Dogecoin down 14.61%, Cardano down 11.73%, and Tron down 8.34%.
The Kimchi Premium, representing the price difference of Bitcoin between domestic and international markets, rose to 8.14%, indicating an overheated domestic market. This is typically considered high if it surpasses 5%.
The cryptocurrency market turned sharply downwards after U.S. President Donald Trump decided to impose tariffs on imports from Canada, Mexico, and China. Amid the rising tensions in global trade disputes in the absence of any significant positive news, risky assets have been directly hit.
On February 1st, Trump signed an executive order that, under the International Emergency Economic Powers Act (IEEPA), imposed additional tariffs: 25% on Canadian and Mexican products (10% for oil and natural gas) and 10% on Chinese products from February 4th.
Canada and Mexico have immediately protested and are preparing retaliatory tariffs. Market analysts are cautious about the escalating trade tensions and unpredictable outcome, warning that further retaliatory measures could worsen market conditions.
Despite the immediate negative impact, some experts believe that the tariff shocks could ultimately benefit Bitcoin. Jeff Park, head of Bitwise Alpha Strategy, predicted that the tariff war could drive up the price of Bitcoin in the long term. If inflation within the United States worsens, resulting in a global decline in currency value, partner countries might seek value-storing assets such as Bitcoin.
The Fear & Greed Index, compiled by global cryptocurrency data firm Alternative, dropped to 44, indicating a “Fear” level, down from the previous day’s “Greed” level of 60. This index ranges from 0, indicating extreme fear, to 100, indicating extreme optimism.