Crypto Market Bloody Monday: Is Bitcoin’s Safe-Haven Status Over? Schiff Warns of BTC Collapse, Blames Trump!

As global markets plunged due to wide-ranging U.S. tariffs, economist Peter Schiff offered a stark assessment. Declaring the cryptocurrency space is “finally starting to crack,” the gold advocate blamed President Trump’s controversial trade actions for sparking liquidations across traditional and digital assets. His remarks came amid rising fears of a financial crisis and a crypto market crash, dubbed Bloody Monday. Schiff, a persistent crypto skeptic, took to social media to highlight what he sees as the start of a broader decline.

The economist also criticized Trump’s Strategic Bitcoin Reserve, describing it as a flawed effort to link government policy with speculative holdings. Bitcoin price fell sharply, dropping over 10% in one day to $75K far below its $108,786 January high. ETH and XRP price mirrored this trend, with the total crypto market losing billions in value. Schiff’s criticism went beyond market data, challenging the crypto supporters backing Trump’s economic plan, which he argues will worsen the financial fallout.

Tariffs and Turmoil: The Trigger Behind the Bloody Monday Selloff

The current market anxiety stems from Trump’s extensive tariffs, revealed shortly before the downturn. The United States imposed a flat 10% tariff on all imports alongside targeted increases for key trading partners like China, India, and Japan. This action prompted immediate retaliation from China and raised renewed concerns about a potential global trade war. Schiff described these tariffs as “dumber” than establishing the reserve, highlighting their immediate negative impact on investor confidence.

I thought the dumbest thing Trump would do was establish a Strategic Bitcoin Reserve. I was wrong.

— Peter Schiff (@PeterSchiff) April 7, 2025

Markets reacted severely, with Dow Jones, S&P 500, and Nasdaq all dropping more than 5% Monday morning, signaling impending chaos. Asian markets followed, with Japan’s Nikkei 225 decreasing 6.47% and Taiwan’s Taiex falling almost 10%, halting trading for major companies. Schiff used these events to argue that risk assets like BTC are not just failing as safe havens but are also worsening investor losses.

Schiff Targets Saylor and the Crypto Elite

Schiff also focused on prominent Bitcoin supporters, notably Strategy founder Michael Saylor. With Bitcoin dropping under $80,000, the economist mocked Saylor on X, suggesting he “back up the truck with borrowed money.” Saylor’s company had recently acquired 22,048 BTC averaging $86,969, increasing pressure as prices neared his break-even point.

He challenged the narrative promoting Bitcoin as a “safe haven,” pointing out its greater volatility than traditional markets. Schiff’s perspective aligns with that of skeptics who argue that BTC’s recent decoupling from the S&P 500 could indicate weakness. As the leading cryptocurrency continues mirroring macroeconomic stress rather than buffering against it, Schiff sees his long-standing fragility warnings come true.

A Bleeding Market, and a Message Ignored

Adding fuel to Schiff’s warnings, data showed nearly $900 million in crypto positions were liquidated within just 24 hours. Bitcoin accounted for $300 million of this total, while Ethereum and XRP price suffered even steeper percentage declines. Despite earlier optimism about crypto’s resilience, the crypto market crash on Bloody Monday revealed weaknesses Schiff has often highlighted.

Leaders in the crypto industry are united in their support for Trump's tariffs. There are three possible explanations. 1) They're actually this dumb? 2) They need to back anything Trump does to secure his continued support. 3) They believe the economic harm will benefit Bitcoin.

— Peter Schiff (@PeterSchiff) April 6, 2025

He also attacked industry figures for supporting Trump’s economic strategies, implying their backing is a sign of incompetence, opportunism, or merely following the president to secure his backing. His criticism underscores concerns that political agendas are overshadowing financial judgment within the crypto space, potentially exposing retail investors to significant risk.

Safe Haven or Sinking Ship?

Entering a new week, questions loom over crypto’s position within the global financial system. Schiff’s stance challenges the belief that Bitcoin serves as a hedge against macroeconomic turbulence. Recent performance suggests the opposite: BTC price appears to suffer sharper declines than traditional assets during crises.

Looking forward, Schiff warns this episode may be just the beginning. With Q1 already marking Bitcoin price worst start in a decade, the combination of trade instability and speculative market practices could cause prolonged volatility. For now, Schiff’s critique stands as an attack on Trump-era economic approaches and a broader accusation against the crypto industry’s untested assumptions in a crisis.