Biden’s 104% China Tariff Bombshell Crushes Bitcoin’s Fleeting Recovery
Note: This post may contain affiliate links, and we may earn a commission (with No additional cost for you) if you purchase via our link. See our disclosure for more info. The gold and crypto world is constantly changing. This is not financial, investment, legal, or professional advice. So, please verify the information on the gold and cryptocurrency provider’s websites.
Although markets anxiously awaited President Biden's decision on Chinese tariffs, the announcement of a staggering 104% rate sent shockwaves through global economies and crypto markets alike. Not since the trade war of 2018-2019 has such aggressive economic policy rattled investor confidence so thoroughly.
Bitcoin took an immediate hit, dropping 3% within hours of the news breaking. The crypto market reacted predictably—panic selling. Bitcoin plummeted to $81,600 on April 4th. A brutal $91 million in BTC long positions liquidated in just 24 hours. Ouch. The ripple effects spread quickly, putting a potential $793.4 million at risk if prices dipped below $81k. Not exactly the “digital gold” narrative holders signed up for.
China didn't take this lying down. They fired back with their own 34% tariffs on April 10th. The U.S. had already amended tariffs to 84% on April 9th, effective 12:01 AM EDT. Economic warfare, plain and simple.
Bitcoin's correlation with traditional risk assets became painfully obvious. When geopolitical tensions flare, crypto bleeds just like stocks. So much for decentralization saving the day.
The mining sector faces particular devastation. ASIC machines from Chinese manufacturers like Bitmain now cost considerably more to import. U.S. miners, already struggling with energy costs, just got another kick while down. The significant Long/Short ratio decline below 1 indicated a dramatic shift toward bearish market sentiment. Profit margins? Evaporating faster than morning dew in Death Valley.
Some analysts point to a possible silver lining. Long-term, Bitcoin could eventually benefit as a hedge against inflation and currency devaluation. History suggests these trade tensions eventually resolve. But for now? Pain.
The 90-day tariff pause for some countries offers minimal relief against the broader economic uncertainty. Markets hate uncertainty more than bad news. And this tariff bombshell delivered uncertainty by the truckload.
Bitcoin's road to recovery looks longer and bumpier than before. Bitcoin did show some resilience by rebounding to $83,200 after the initial price shock. What was once a fleeting recovery now resembles a mirage—visible but unreachable. For crypto investors, patience isn't just a virtue. It's a necessity.
