Crypto Majors Tumble Amid U.S.-China Tariff Tensions

Generated by AI AgentCoin World
Tuesday, Feb 4, 2025 8:00 am ET1min read
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Crypto Majors Retract Gains Amid U.S.-China Tariff Tensions

The crypto market experienced a rollercoaster ride this week as U.S.-China trade tensions escalated, leading to significant price swings in major cryptocurrencies. Bitcoin, the world's largest cryptocurrency, briefly soared past $100,000 after President Trump paused tariffs on Mexico and Canada but dropped to $98,000 when China struck back with fresh tariffs on U.S. imports.

XRP and Dogecoin surged by 20% before dipping again as the U.S.-China trade war rattled the crypto market. Bitcoin briefly soared past $100K after President Trump paused tariffs on Mexico and Canada but dropped to $98K when China struck back with fresh tariffs on U.S. imports.

Despite being decentralized, crypto still reacts like traditional financial markets. Many believe this isn’t just about trade—it’s a battle over supply chains, financial dominance, and economic control. If the U.S. keeps escalating, China may accelerate de-dollarization, push its central bank digital currency (CBDC), and tighten its hold on critical industries.

Crypto traders took advantage of a “buy-the-dip” opportunity after Monday’s $2.2 billion liquidation, causing XRP and Dogecoin to rise sharply. However, when China retaliated with new tariffs, gains disappeared just as fast. XRP, Dogecoin, Solana (SOL), and Cardano (ADA) managed to hold onto a 3% increase, while Bitcoin (BTC) and Ethereum (ETH) were up about 4%, but volatility remains high.

Analysts are divided on how long this market chaos will last. Min Jung from Prestro Research explained that despite Bitcoin’s reputation as “digital gold,” it still behaves like a risky asset. This means China’s tariffs impact it just like stocks, leading to short-term pressure. Jung called this crash an overreaction, but traders should be prepared for the worst. The big question now is whether this is just a negotiation tactic or the beginning of a long economic war. If tensions rise further, crypto markets could suffer extended pullbacks.

For now, XRP and Dogecoin remain at the mercy of global economic tensions.