Bitcoin Drops 2% on China's 34% Tariff Announcement

Bitcoin experienced a sudden and sharp decline following China's announcement of retaliatory tariffs against the United States. The move, which included a 34% charge on all U.S. goods, sparked fears of a broader market crisis, with some analysts warning of a potential "crisis scenario" for the cryptocurrency.

The bitcoin price fell by 2% within minutes of the tariff announcement, despite hopes that the Federal Reserve might intervene to stabilize markets. This sudden drop highlighted the sensitivity of the cryptocurrency market to geopolitical tensions and trade disputes.

Analysts have expressed concerns that the ongoing trade war between China and the United States could lead to further volatility in the bitcoin market. Sergei Gorev, head of risk at a bitcoin and crypto platform, described the situation as a "bearish scenario" for American stock markets and global trading participants. He warned that if prices fall below the March lows, a crisis scenario could unfold by 2025.

In March, bitcoin briefly dipped below $80,000 per bitcoin before rebounding on hopes that U.S. President Donald Trump would scale back his planned trade tariffs. The recent tariff escalation has renewed fears of a prolonged trade war, which could have significant implications for the cryptocurrency market.