Bitcoin News Today: Trade War Over Rare Earths Sparks Crypto Collapse and Global Market Turmoil

Bitcoin and the broader cryptocurrency market experienced their largest decline in 2025 following U.S. President Donald Trump's announcement of a 100% tariff on Chinese goods, effective November 1, 2025. The move, framed as a response to China's "aggressive" export controls on rare-earth materials, triggered a global market selloff, with Bitcoin plunging nearly 10% to $108,000 within hours Bitcoin Magazine^[1]. The price later rebounded slightly to around $113,000, but the volatility underscored the deepening trade tensions between the world's two largest economies Coindesk^[2].

The U.S. president accused China of monopolizing critical resources and announced complementary export restrictions on American software, escalating the trade dispute. This prompted immediate reactions across financial markets, with the S&P 500 dropping 2% and the Nasdaq falling 2.7% Decrypt^[3]. Bitcoin's decline mirrored that of traditional assets, as investors shifted to safer havens like gold, which surged over 1% to $4,000 per ounce FXStreet^[4].

The crypto market's losses were severe. At the height of the sell-off, Bitcoin fell below $110,000, while Ethereum and Solana dropped 15% and 20%, respectively. The total cryptocurrency market capitalization plummeted by $280 billion in a single day, with over $7 billion in leveraged positions liquidated within an hour The Coin Republic^[5]. Altcoins fared worse, with XRP and BNB sliding 30% and 20%, respectively Coindesk^[6].

The impact extended beyond digital assets. Crypto-related stocks, including Circle (CRCL), Robinhood (HOOD), and Coinbase (COIN), fell 3%-12% as the sector faced renewed scrutiny. Analysts attributed the sharp decline to the "risk-off" sentiment driven by Trump's tariff threats, which revived memories of earlier trade wars. In April 2025, similar tariffs had erased $200 billion from the crypto market, with Bitcoin briefly hitting $75,000 Cointelegraph^[7].

Economic analysts highlighted the broader implications of the trade war. China's export controls on rare earths-materials critical for semiconductors, AI, and defense technologies-threatened to disrupt global supply chains. The U.S. response, including export restrictions on critical software, further exacerbated uncertainties. JPMorgan raised its global recession risk to 60%, citing the potential for prolonged trade tensions to slow economic growth Decrypt^[8].

Despite the turmoil, some analysts noted historical parallels. The April 2025 tariff-driven selloff had seen Bitcoin recover within weeks, reaching $85,000 by mid-April. However, the current environment is more volatile, with macroeconomic factors like a U.S. government shutdown and inflation data looming as additional risks The Coin Republic^[9].

The trade war's impact on supply chains is already evident. Electronics, automotive, and pharmaceutical sectors face rising costs as tariffs and export controls disrupt production. For instance, U.S. electronics imports from China, valued at $146 billion in 2024, could see annual cost increases of $182 billion under the new tariffs Cointelegraph^[10].

As of October 10, 2025, Bitcoin remains below its October peak of $126,000, with analysts divided on its near-term trajectory. While some predict a rebound to $180,000–$200,000 in the current bull cycle, others caution that the trade war could prolong volatility. The market's next move will depend on whether Beijing retaliates and whether Trump's policies shift after the APEC summit, which he canceled Coindesk^[11].