Today, the bitcoin price fell into the $118,000s following President Trump’s announcement to increase tariffs on Chinese goods, a reaction to China’s new export controls on rare earth metals.
In the past 24 hours, bitcoin’s value has decreased by approximately 2.3% and is down about 6% from its recent peak of over $126,000 just four days ago.
President Trump warned of a significant tariff increase on Chinese imports, indicating a sharp escalation in U.S.-China trade relations and raising questions about an upcoming APEC meeting with President Xi. This announcement follows China’s introduction of new restrictions on rare earth and technology trade.
“I was supposed to meet President Xi in two weeks at APEC in South Korea, but now it seems there’s no reason to proceed,” Trump stated on Truth Social.
China demands that foreign companies get special permission to export products containing even minor amounts of Chinese rare earth elements, crucial for various technologies including jet engines, electric vehicles, laptops, and smartphones.
Trade discussions between China and the U.S. this year have revolved around rare earths, TikTok, and tariffs, with three rounds of talks held to date. Following discussions in May in Geneva, the U.S. reported that China had agreed to relax some of its rare earth export limitations.
All markets reacted negatively, resembling the sentiment from April when President Trump’s ‘Liberation Day’ tariffs disturbed the markets. These tariffs, introduced via Executive Order 14257, declared a trade deficit emergency and imposed extensive U.S. import duties.
Bitcoin Price Reaction
Bitcoin began October with a significant jump, hitting all-time highs above $126,000 in the first week. Recently, its price has retraced to the $121,000 range.
Some analysts suggest that the bitcoin market is currently experiencing what many refer to as the “euphoria phase” of this bull cycle.
If historical trends continue, bitcoin’s current euphoric state could lead it towards the $180,000–$200,000 range before the mood shifts.
This year, bitcoin has surged over 30%, propelled by continuous investments into U.S.-listed Bitcoin exchange-traded funds, renewed investor optimism in digital assets, and expectations for the Federal Reserve to consider cutting interest rates.
Crypto-related stocks, including Circle (CRCL), Robinhood (HOOD), Coinbase (COIN), and MicroStrategy (MSTR), faced declines of 3%-6% at various times throughout the day.
