TLDR
- China imposed retaliatory tariffs (10-15%) on U.S. goods including coal, LNG, oil, and agricultural machinery after Trump’s new 10% tariffs took effect
- Bitcoin dropped to $98,500, showing relative resilience compared to other cryptocurrencies, while Dogecoin led losses at 5.8% down
- Trump agreed to a 30-day pause on tariffs against Mexico and Canada, which had briefly helped Bitcoin recover from $92,000 to $102,000
- China launched an antitrust probe into Google and added PVH Corp and Illumina to its unreliable entities list
- Global markets reacted with NASDAQ futures dropping 1.7% and commodities facing broad pressure, except for copper gaining 0.35%
China struck back at the United States on Tuesday with new tariffs ranging from 10% to 15% on various American goods, marking another escalation in the ongoing trade tensions between the world’s two largest economies. The move came as a direct response to President Donald Trump’s recent implementation of 10% tariffs on Chinese imports.
Beijing’s countermeasures target specific U.S. sectors, with a 15% duty imposed on coal and liquefied natural gas (LNG) imports. Additionally, a 10% tax now applies to crude oil, agricultural machinery, pickup trucks, and large-engine cars, according to official announcements from the Chinese government.
The cryptocurrency market felt immediate effects from this development. Bitcoin, the leading digital currency, declined to $98,500, representing a 2.5% drop. However, this decrease was notably smaller compared to other cryptocurrencies, demonstrating Bitcoin’s relative stability during market uncertainty.
Other digital currencies experienced steeper declines, with Dogecoin recording the largest drop among the top 10 cryptocurrencies, falling 5.8%. XRP followed closely behind with a 5.1% decrease. These movements resulted in over $2.2 billion in liquidations across the crypto market as investors responded to the escalating trade situation.
The timing of China’s announcement proved particularly impactful as it followed a brief period of market optimism. Just the day before, Bitcoin had shown promising recovery, climbing from $92,000 to over $102,000 after President Trump announced a 30-day pause on tariff threats against Mexico and Canada.
Beyond tariffs, China took additional measures by launching an antitrust investigation into Google. The probe, initiated by China’s State Administration for Market Regulation, coincided with the implementation of the new U.S. tariffs. In a related move, Beijing added clothing company PVH Corp and biotechnology firm Illumina to its list of unreliable entities.
The effects of these developments extended beyond the cryptocurrency market. NASDAQ 100 futures dropped 1.7% during Asian trading hours, though they later recovered slightly to show a 1.2% decline. This movement occurred eight hours before the opening of U.S. markets, suggesting potential volatility in the trading day ahead.
The commodity markets also showed reaction to the news. Natural gas prices fell by 2%, while crude oil decreased by 1.74%. Copper emerged as an exception among major commodities, managing a modest gain of 0.35%.
Ethereum and Solana, two major cryptocurrencies, had experienced their own volatility in the preceding days. Ethereum notably suffered an 18% crash during Monday trading in the U.S., dropping to $2,135 and marking its steepest single-day decline since May 2021. This movement erased more than $600 million in market value before the price rebounded to $2,881.
The dollar index strengthened during this period as investors sought safe-haven assets amid the market uncertainty. This movement typically indicates a shift toward more conservative investment strategies during periods of economic tension.
Market analysts noted that the crypto market’s reaction aligned with broader financial market movements, highlighting the increasing correlation between digital assets and traditional markets during periods of economic stress.
Trade data showed that Asian markets responded quickly to the news, with regional exchanges recording increased trading volume as investors adjusted their positions in response to the new tariffs.
The development represents the latest chapter in the complex trade relationship between the United States and China, with both nations implementing measures that impact various sectors of their respective economies.
Early market indicators suggest that the effects of these new tariffs could continue to influence trading patterns across multiple asset classes as markets digest the implications of these policy changes.
Recent trading data indicates that market participants are closely monitoring developments, with trading volumes across crypto exchanges showing elevated levels compared to previous weeks.
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