Question #102 ·
Why did bitcoin’s price drop from $126,000 to $102,000 after the announcement of new tariffs on Chinese imports?
- A global software glitch prevented wallets from trading, creating artificial scarcity and price tumble
- Miners shutting down operations for maintenance caused sudden supply drop and price collapse overnight
- Because the tariff announcement sparked panic selling and over $19 billion in leveraged liquidations Right answer
Why is this the correct answer?
This is correct because when President Trump announced 100 percent tariffs on Chinese imports, many traders holding Bitcoin on margin rushed to sell. Rapid selling caused forced liquidations of over $19 billion in leveraged positions, driving the price sharply down. For beginners, leveraged trading means borrowing funds to trade larger positions, which can amplify both gains and losses in volatile markets.