Bitcoin (BTC) dominance — a measure of Bitcoin’s share of the total cryptocurrency market cap — surged above 60% on February 2 amid a broader downturn in the crypto markets triggered by US President Donald Trump’s tariffs. Altcoins took the hardest hit, with Ether (ETH) falling by approximately 9.3% over the last seven days, XRP dropping 13.8%, and Solana (SOL) losing around 19.3%, according to CoinMarketCap. Trump’s newly imposed tariffs included a 25% tax on imports from Canada, 25% on all products from Mexico, and 10% on all goods from China, which led to retaliatory tariffs from those countries. As concerns about increased inflation and high interest rates in 2025 mounted, investors sought refuge in US government securities, moving away from riskier assets.
More Short-Term Pain Likely Ahead
Trader and analyst Van Nuener suggested that the crypto market could face further declines following the opening of US futures markets on February 2.
“The futures will probably open down and that may cause crypto to do the same,” Nuener warned his followers on social media. BitMEX co-founder Arthur Hayes had predicted a crypto sell-off in December, anticipating that the initial optimism surrounding President Trump’s pro-crypto stance would dissipate once traders realized that crypto legislation would take time to pass. Ryan Lee, chief analyst at Bitget Research, also forecasted a potential BTC correction to the $95,000 price level in the near term. The analyst mentioned that macroeconomic factors, such as labor statistics and Federal Reserve policy, would play a significant role in determining Bitcoin’s price in the coming weeks.
Trump’s tariffs come on the heels of a downturn in US tech stocks and the crypto market, triggered by the release of DeepSeek R1 — an open-source AI model developed and trained in China. According to the DeepSeek whitepaper, the model performs similarly to leading OpenAI models but was trained at a fraction of the cost using older computing hardware. The launch of DeepSeek was described as a black swan event, prompting the Trump administration to consider imposing stricter export restrictions on Nvidia sales to China, adding more uncertainty to financial markets.
Conclusion:
While Bitcoin’s dominance is increasing as altcoins struggle amid a broader market downturn, the outlook for crypto remains uncertain. The new tariffs and the resulting market volatility may continue to weigh on prices in the short term. Macroeconomic factors and investor sentiment will likely play key roles in shaping Bitcoin’s price trajectory in the coming weeks.
FAQs:
Why has Bitcoin’s dominance risen above 60%?
Bitcoin’s dominance has increased due to a downturn in the altcoin market caused by President Trump’s newly imposed tariffs, which have led investors to shift their focus to Bitcoin.
How have altcoins performed amid the downturn?
Altcoins like Ether, XRP, and Solana have experienced significant losses, with declines ranging from 9.3% to 19.3% over the past week.
What impact have President Trump’s tariffs had on the market?
The tariffs have created uncertainty in the markets, leading to concerns about inflation, high interest rates, and increased economic instability. This has prompted investors to move away from riskier assets like cryptocurrencies.
I am Toby Rothschild, Co-Founder of Spearmint and author at Coinography, and a strategist focused on advancing Web3 innovation, digital ecosystems, and the future of decentralized technology. I combine product thinking, creative leadership, and deep interest in emerging trends to help shape how individuals and organizations interact with the next generation of digital systems.
My work centers on understanding how blockchain, AI, and digital identity are reshaping global industries. At Spearmint, I help lead the direction of initiatives that bring clarity, structure, and meaningful user experiences to complex technological environments. I focus on bridging vision with execution, ensuring that innovation remains practical, scalable, and aligned with long-term growth.
As an author at Coinography, I create insights that translate fast-moving Web3 developments into clear, useful narratives. I explore topics such as decentralized governance, digital identity, creator economies, token models, protocol design, and the shifting cultural patterns around emerging technology. My aim is to make digital transformation more understandable and approachable for a wider audience.
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