Bitcoin has seen a decline in value as trade tensions escalate. Currently, BTC is trading at $100,780, which is nearly 9% below its all-time high of $109,000, reached on January 20 during Donald Trump’s inauguration.
China has responded to US tariffs by announcing its own retaliatory measures. Starting on February 10, China will impose 15% tariffs on coal and liquefied natural gas, as well as 10% tariffs on crude oil, agricultural machinery, and some vehicles.
In addition, China’s Ministry of Commerce and Customs authorities have implemented new export controls on over two dozen metal products and related technologies. These include tungsten, a crucial mineral in industrial and defense applications, and tellurium, which is used in the production of solar cells.
Julian Evans-Pritchard, head of China Economics at Capital Economics, stated that China’s measures, while significant, are modest when compared to US actions. He noted, “These measures seem designed to send a message to both the US and domestic audiences without causing severe economic damage.” The Chinese tariffs only target around $20 billion worth of annual imports from the US, a fraction of the $450 billion worth of Chinese goods affected by US tariffs.
This escalation follows the US government’s imposition of new tariffs on imports from Canada, Mexico, and China on February 1st. US tariffs increased duties by 25% on imports from Canada and Mexico, while a 10% tariff was applied to Chinese imports. This move caused a sharp reaction in global financial markets as trade tensions escalated. However, Donald Trump later agreed to postpone the imposition of tariffs on Canada and Mexico for 30 days.
On Tuesday, the market’s response was mixed. After initially recovering some losses on Monday, global financial markets fluctuated. In Hong Kong, the Hang Seng index surged by 2.8%, while South Korea’s Kospi rose 1.3%. The British pound slightly fell, down half a cent to $1.24 against the US dollar, while the euro saw a similar decrease, trading at $1.03.
Bitcoin’s Resilience Amidst Crypto Turmoil
Among the various assets affected by these tariffs, Bitcoin has shown resilience compared to other cryptocurrencies. In contrast, other major cryptocurrencies such as Solana (SOL), Dogecoin (DOGE), and Cardano (ADA) experienced declines of 16%, 23%, and 24% respectively, just yesterday. However, in the last 24 hours, ADA has managed to rise by 5.15%, while DOGE has increased by 3.425%, now trading at 0.2673.
The reaction of the crypto market highlights how geopolitical and economic events, even if seemingly unrelated, can trigger significant volatility within the sector. A similar pattern was observed recently when a DeepSeek-induced selloff of Nvidia had a broad impact on the crypto market, specifically AI coins. These events emphasize the sensitivity of cryptocurrencies to macroeconomic factors, with global political moves playing an increasingly significant role in shaping market performance.