Bitcoin News Today: Trump's Tariffs Send Crypto Markets into Tailspin, Erasing $200B

President Donald Trump's announcement of a 100% tariff on Chinese imports and critical software export controls, effective November 1, 2025, triggered an immediate and severe selloff in global financial markets, with cryptocurrencies bearing the brunt of the volatility. The U.S. president cited China's "extraordinarily aggressive" export restrictions on rare earth minerals as justification, escalating trade tensions to levels not seen since 2019. The S&P 500 and Nasdaq plummeted, while the total cryptocurrency market capitalization fell from $4.25 trillion to $4.05 trillion within hours, erasing nearly $200 billion in value BeInCrypto^[2].

Bitcoin (BTC) and Ethereum (ETH) were among the hardest-hit assets. Bitcoin dropped from $122,000 to $107,000 within 24 hours, a 10% decline, while Ethereum fell 14.2% to $3,742.88 CNN^[1]. Solana (SOL) and other altcoins experienced even sharper declines, with Solana falling nearly 20% to $178.72. The crypto market saw over $19 billion in leveraged positions liquidated, according to data analytics platforms CoinGlass and CoinGecko CNN^[1]BeInCrypto^[2]. This marked the largest liquidation event in crypto history, with over 1.6 million traders affected .

The tariffs and export controls were framed as retaliatory measures against China's restrictions on rare earth minerals, which account for 70% of global supply. These minerals are critical for semiconductors, AI, and defense technologies. Trump also announced export controls on U.S. critical software, further deepening the trade conflict. Analysts warned that the combined impact could strain global technology supply chains and exacerbate macroeconomic uncertainties CNBC^[4].

The market reaction underscored crypto's sensitivity to geopolitical risks. Bitcoin's decline tested key psychological levels, while altcoins underperformed amid heavy selling. Traders and analysts likened the crash to the March 2020 pandemic-induced sell-off, with some calling it a "risk-off" retreat across all asset classes Coindesk^[3]. "The altcoin complex got absolutely eviscerated," said Zaheer Ebtikar of Split Capital, noting that altcoins reached levels not seen in over a year Coindesk^[3].

Despite the turmoil, some analysts viewed the selloff as a "leverage purge" rather than a structural collapse. Over $16.8 billion in long positions were liquidated, pushing weak hands out of the market. Short positions, now heavily extended, could face a potential squeeze if prices rebound. Institutional investors, however, continued accumulating Bitcoin via ETFs, suggesting a divergence between retail and institutional sentiment .

The broader economic implications of the trade war remain uncertain. JPMorgan raised global recession risks to 60%, while the WTO warned that U.S.-China trade could shrink by 80%. The immediate focus for markets is whether China will respond in kind or signal willingness to reopen negotiations before November 1 NPR^[5].