Bitcoin Drops 2.6% to $83,000 as China Imposes 34% Tariffs

Bitcoin's price experienced a notable decline, falling back to $83,000 following the announcement of significant tariffs by the United States. The new policy, which includes a 34% tariff on all imports from the United States, was announced by China and is set to take effect from April 10. This move by China is a retaliatory measure in response to the U.S. tariffs, which have escalated global trade tensions. The combined tariff rate for China now stands at 54%, including the new 34% surcharge on top of the existing 20% tariff. Other countries affected by the U.S. tariffs include Japan with a 24% levy, the European Union with a 20% tariff, and several other Asian economies facing varying rates.

The announcement of these tariffs has triggered market uncertainty, with global markets reacting sharply. Bitcoin, which had been rallying, saw a drop of 2.6%, while Ethereum fell by 6%. Investors are expressing concerns about potential stricter crypto regulations and the overall market instability that could arise if trading partners retaliate. However, some analysts believe that clarity on trade policies could attract institutional investors, potentially stabilizing crypto prices in the long run.

The new tariffs are part of a broader policy aimed at protecting American businesses and creating fair trade. President Donald Trump, in a statement from the White House Rose Garden, asserted that the U.S. is only charging what other countries already charge. Critics, however, argue that these tariffs could increase inflation and negatively impact global economic growth. The immediate reaction from global markets was significant, with the S&P 500 losing $2 trillion during the sell-off. The crypto market also faced heavy losses, with the total market cap falling by 5.3%.

The Crypto Fear & Greed Index hit 25, indicating extreme fear among investors. Analysts predict further declines if major economies retaliate. However, some experts believe that clarity on trade policies could bring stability. Bitcoin price predictions suggest that if confidence returns, Bitcoin could recover to above $89,000. The market is now closely watching for new crypto regulations and global responses to these tariffs.

Risk sentiment worsened during the European hours Friday after China announced retaliatory tariffs on all goods, responding to Trump's Wednesday decision to boost the overall levy on Chinese goods to 54%.

Meanwhile, futures tied to the S&P 500 and Nasdaq fell over 2% amid escalating global trade tensions. "China's response is not only negative for the U.S. but it is also impacting the global outlook," an analyst wrote in a market update.