U.S. 104% Tariff on China Sends Crypto Markets Tumbling 6%

The U.S. government's imposition of a 104% tariff on Chinese goods has sent shockwaves through the global markets, with the cryptocurrency sector experiencing significant turbulence. This drastic measure, announced by the White House, triggered a wave of panic selling across the crypto landscape, wiping out billions from the global cryptocurrency market cap almost instantly. The tariff, which is cumulative, means that the effective tariff rate on Chinese imports would rise to 54% starting from April 9. In response, China retaliated with a 34% tariff on U.S. goods, further exacerbating the economic uncertainty and market volatility.

Bitcoin (BTC), which had been showing signs of bullish momentum earlier in the week, crashed to a low of $74,589 before recovering slightly to hover around $77,100. Ethereum (ETH) wasn’t spared either, dropping over 6% in just a day. Other top altcoins like Solana (SOL) and XRP saw similar declines, with both losing around 3% of their value. The sudden downturn in crypto markets shows how tightly interconnected geopolitical events and investor sentiment have become. As global uncertainty rises, even digital assets, often thought of as safe havens or “uncorrelated” assets, are feeling the heat.

The Crypto Fear and Greed Index, a widely followed sentiment tracker, dropped sharply to a reading of 15, signaling “Extreme Fear.” The psychological impact of such a low rating can’t be overstated. Many retail investors are now hesitant to make any moves, while some whales are reportedly shifting funds into stablecoins or pulling assets off exchanges entirely. Daily trading volumes also saw a massive decline, falling by 35% to just $124.44 billion across the top exchanges. Analysts suggest this reflects both a freeze in buyer enthusiasm and a defensive pullback among investors trying to minimize exposure to ongoing volatility.

While the broader market was painted red, a few altcoins managed to defy the trend. Tokens like HYPE, IP, and JASMY managed to climb over 3%, showing some resilience amid the chaos. These exceptions were likely driven by niche communities or ecosystem-specific news rather than macroeconomic factors. However, the vast majority of altcoins followed Bitcoin’s lead into the red. Notably, AB suffered a brutal 23% drop, while NEAR and EOS each fell by more than 10%. With market sentiment so fragile, even small bits of negative news are having outsized effects on token prices.

Despite the bloodbath, not everyone is throwing in the towel. Influential crypto analysts have voiced a more optimistic outlook. They argue that this could be the last major correction before a broader bull run resumes later this year. For seasoned investors, this may be seen as a potential buying opportunity, though most are urging caution given the geopolitical uncertainty. In the meantime, crypto holders are advised to stay updated and avoid impulsive decisions. The market remains in flux, and until there’s clarity on how long the U.S.-China trade dispute will last, volatility is likely to continue.