The crypto market saw a major surge followed by an abrupt reversal in the past 24 hours, as investors initially bought the dip after Monday’s massive $2.2 billion sell-off. But just as traders were celebrating, China’s retaliatory tariffs on the U.S. wiped out much of the gains.
What Happened?
🔹 XRP, Dogecoin (DOGE), Solana (SOL), and Cardano (ADA) soared nearly 20% before pulling back.
🔹 Bitcoin (BTC) and Ethereum (ETH) held on to 4% gains, while some altcoins managed to stay up around 3%.
🔹 The rally was cut short when China announced a 10% tariff on U.S. imports, responding to Trump’s earlier trade restrictions.
Why Did Crypto Reverse?
The latest U.S.-China trade conflict is making investors nervous, affecting global markets—including crypto.
Ben El-Baz, Managing Director at HashKey Global, warned that a prolonged trade war could reduce risk appetite, making it harder for crypto to maintain its bull run. However, he noted that pro-crypto policies in the U.S. could help counteract the damage.
Min Jung, a research analyst at Prestro Research, pointed out that Bitcoin still trades like a risk asset, meaning it reacts to global tensions much like stocks do.
More Volatility Ahead?
The biggest question now is whether China’s move is just a negotiation tactic—similar to the temporary tariff pause with Canada and Mexico—or if it marks the start of a prolonged trade war.
While some traders saw gains from buying the dip, analysts warn that more volatility is expected as markets react to further developments.
One thing is certain—crypto is once again at the center of global economic shifts, and traders should buckle up for what’s next.
