Bitcoin May Experience Volatility Amid U.S.-China Trade Tensions After Trump’s 100% Tariff Warning

• Immediate market reaction: Bitcoin plunged sharply after the tariff warning, reflecting heightened risk aversion.

• Trade policy shifts, including export controls on rare earths, are increasing macroeconomic uncertainty for tech and crypto sectors.

• Exchange price data reported a fall from roughly $121,560 to below $103,000 within hours, then partial stabilization as traders reassessed exposure.

US-China trade war crypto markets: Trump’s 100% tariff threat sparked rapid Bitcoin volatility, highlighting crypto sensitivity to geopolitics. COINOTAG.

How does the US-China trade war affect cryptocurrency markets?

The US-China trade war affects cryptocurrency markets by amplifying short-term volatility and changing investor risk preferences. Geopolitical escalations—such as threats of 100% tariffs—can trigger rapid capital flows, momentary liquidity squeezes and re-priced risk across both traditional and digital assets within hours.

Why did Bitcoin drop after the tariff threat?

Exchange-level price data indicated a rapid retreat in Bitcoin following President Trump’s public threat of a 100% tariff on Chinese imports. Traders reacted to potential supply-chain disruptions and broader equity market weakness. The drop reflected a swift risk-off move, where leveraged positions were unwound and stop orders amplified downward momentum.

What role do export controls and rare earths play?

China’s tightening of export controls on rare earth minerals—used in semiconductors and other high-tech manufacturing—raises concerns about global tech supply chains. These controls can slow chip production, increase input costs for tech firms and heighten macroeconomic uncertainty, all of which may spill over to crypto through investor sentiment and cross-asset correlations.

Frequently Asked Questions

How big was Bitcoin’s decline after the tariff warning?

According to market data referenced in this report, Bitcoin fell from around $121,560 to under $103,000 within hours of the public tariff warning, a sharp intraday move driven by heightened geopolitical risk and rapid de-risking by traders.

Will cryptocurrencies serve as a hedge during trade wars?

Cryptocurrencies have occasionally acted as a hedge in certain scenarios, but their performance is inconsistent. During acute market stress, crypto can correlate with risk assets; investors should evaluate liquidity, volatility and time horizon before assuming crypto is a reliable hedge.

Analysis and Context

President Trump confirmed the United States is in an active trade war with China and reiterated a potential 100% tariff on Chinese imports. In remarks to White House reporters he said, “Well, we’re in one now,” and framed tariffs as part of national security strategy. A social-media post warning about tariffs was followed by a rapid market reaction that included a sharp Bitcoin sell-off.

Market participants cited several mechanisms behind the crypto reaction: forced deleveraging in futures and margin markets, correlated selling from risk-asset portfolios, and an immediate reassessment of macroeconomic growth prospects. Crypto exchanges show that rapid directional moves can be amplified by thin liquidity in certain trading pairs.

Authoritative sources to consult for official trade policy and export-control updates include U.S. government press releases and China’s Ministry of Commerce statements (refer to those organizations’ publications directly for official text). Market price data and on-chain indicators were used to quantify the move described above.

Key Takeaways

• Geopolitical sensitivity: Crypto markets are sensitive to geopolitical shocks and can move sharply on trade-policy announcements.
• Volatility mechanism: Rapid price changes were driven by liquidity squeezes, margin calls and correlated selling across risk assets.
• Investor action: Monitor official trade policy updates and exchange liquidity; consider risk management tools before increasing exposure.

Conclusion

Trade tensions between the United States and China, including public threats of 100% tariffs and tightened export controls on rare earths, have a demonstrable short-term impact on the cryptocurrency market. Investors should treat geopolitical events as material market drivers and incorporate liquidity and volatility scenarios into risk frameworks. COINOTAG will continue to monitor policy developments and market data and provide updates as new information becomes available.

Publication date: October 15, 2025. Updated: October 15, 2025.

Author/Organization: COINOTAG

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🚨 JUST IN: President Trump declares the United States is in a TRADE WAR with China — “We’re in one now!” — “We have 100% tariffs.” — “If we didn’t have tariffs, we would have no defense. They’ve used tariffs on us.” — Eric Daugherty (@EricLDaugh) October 15, 2025