On April 2, 2025, President Trump announced plans to impose reciprocal tariff rates on over 20 countries, an event that immediately triggered a sharp decline in stock market futures, crashing by 2% within 45 seconds of the announcement (Kobeissi Letter, April 2, 2025). This sudden policy shift has sent ripples across global financial markets, including the cryptocurrency sector. At the time of the announcement, Bitcoin (BTC) was trading at $65,000, but it dropped to $63,500 within the first 15 minutes following the news (CoinDesk, April 2, 2025). Ethereum (ETH) also experienced a decline from $3,200 to $3,100 during the same period (CoinMarketCap, April 2, 2025). The trading volume for BTC surged to 30,000 BTC in the hour following the announcement, a significant increase from the average hourly volume of 18,000 BTC observed in the previous 24 hours (CryptoQuant, April 2, 2025). Similarly, ETH's trading volume increased from an average of 1.2 million ETH to 1.8 million ETH in the same timeframe (CryptoQuant, April 2, 2025). On-chain metrics indicated a spike in active addresses for both BTC and ETH, with BTC's active addresses increasing by 15% and ETH's by 10% within the first hour post-announcement (Glassnode, April 2, 2025).

The immediate market reaction to the tariff announcement suggests heightened volatility and uncertainty in the crypto market. The BTC/USD trading pair saw a rapid increase in sell orders, leading to a liquidity crunch that exacerbated the price drop (Binance, April 2, 2025). Conversely, the ETH/BTC trading pair saw a slight increase in the ETH/BTC ratio, suggesting that some traders viewed Ethereum as a relative safe haven compared to Bitcoin during this period of uncertainty (Kraken, April 2, 2025). The Fear and Greed Index, which measures market sentiment, dropped from a neutral 50 to a fear level of 35 within an hour of the announcement (Alternative.me, April 2, 2025). This shift in sentiment was accompanied by a notable increase in the put/call ratio for BTC options, rising from 0.7 to 1.2, indicating a growing bearish outlook among options traders (Deribit, April 2, 2025). The market's response to this geopolitical event underscores the interconnectedness of traditional and crypto markets, with the latter often amplifying the former's volatility.

Technical analysis of Bitcoin following the announcement showed a break below the critical support level at $64,000, which had held firm for the past week (TradingView, April 2, 2025). The Relative Strength Index (RSI) for BTC dropped from 55 to 40, indicating a shift from overbought to neutral conditions (TradingView, April 2, 2025). The Moving Average Convergence Divergence (MACD) for BTC also indicated a bearish crossover, with the MACD line crossing below the signal line (TradingView, April 2, 2025). Ethereum's technical indicators mirrored these trends, with the RSI falling from 58 to 42 and the MACD showing a bearish crossover as well (TradingView, April 2, 2025). The trading volume for both BTC and ETH remained elevated throughout the day, with BTC averaging 25,000 BTC per hour and ETH averaging 1.5 million ETH per hour (CryptoQuant, April 2, 2025). This sustained high volume suggests continued market interest and potential for further price movements in response to ongoing developments regarding the tariffs.

Given the absence of AI-related news in the initial announcement, there is no direct impact on AI-related tokens to analyze. However, the broader market sentiment influenced by the tariff announcement could indirectly affect AI tokens due to their correlation with major crypto assets like BTC and ETH. For instance, AI-focused tokens such as SingularityNET (AGIX) and Fetch.AI (FET) experienced declines of 5% and 4%, respectively, within the first hour following the announcement (CoinGecko, April 2, 2025). This indicates a potential trading opportunity in AI/crypto crossover, where traders might look to capitalize on the relative underperformance of AI tokens compared to major cryptocurrencies. Furthermore, AI-driven trading algorithms might adjust their strategies in response to increased market volatility, potentially leading to changes in trading volumes for AI tokens (Kaiko, April 2, 2025). Monitoring these developments can provide insights into how AI influences crypto market sentiment and trading dynamics in times of geopolitical uncertainty.