The ongoing trade dispute between the US and China has escalated, causing significant volatility in global markets, including the cryptocurrency sector. China’s recent decision to impose a 15% tariff on US coal and LNG, alongside a 10% levy on crude oil and agricultural equipment, marks a new phase in the economic tensions between the two superpowers. This move comes after US President Donald Trump reintroduced aggressive trade policies aimed at curbing China’s growing economic influence.
Initially, market sentiment soured as traders reacted to the news, triggering a sharp decline in crypto prices. However, some analysts believe the market’s negative response may be overblown. According to crypto analyst The Crypto Lark Davis, China imports relatively little from the US in the affected categories. For example, China imports just 6% of its LNG from the US, a fraction of global LNG exports. Similarly, US coal exports to China make up only 6% of the total.
Before everyone loses their shit over China's tariffs on the USA.
— Lark Davis (@TheCryptoLark) February 4, 2025
HERE ARE SOME FACTS
China imports very little oil from the USA. It is in 10th place.
China imports 6% of its LNG from the USA. 4 million tons versus USA total export globally of 87 million tons in 2024.
Coal… pic.twitter.com/02iEkQNyE4
Davis cautioned against panic-driven selling, with some analysts predicting that the markets will stabilize. Crypto enthusiast Borovik echoed this sentiment, suggesting that traders who rushed to dump crypto assets in response to the tariffs may soon regret their decision.
Despite the trade tensions with China, a temporary reprieve in US-Canada trade talks led to a brief recovery in Bitcoin’s price, which surpassed $100,000. This highlights the sensitivity of crypto markets to geopolitical developments. However, analysts like Andrew Kang remain cautious. He warned that Ethereum (ETH) prices could retreat to the $2,200-$2,400 range if the trade war intensifies.
Back to 2200-2400 if China trade war is real https://t.co/DYcujirvYO
— Andrew Kang (@Rewkang) February 4, 2025
In the face of short-term market volatility, seasoned investors like Robert Kiyosaki continue to view Bitcoin as a hedge against inflation and geopolitical instability. As global trade tensions unfold, experts like Jeff Park from Bitwise Asset Management predict that Bitcoin will ultimately rise, becoming a preferred asset in times of economic uncertainty.
Also Read: What is DeepSeek? China’s AI Challenger That’s Disrupting Tech Giants
Despite the turmoil, experienced traders know that strategic decision-making could turn current market swings into opportunities for long-term gains.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
About The Author
