Bitcoin risks falling under $100,000 as Trump confirms US-China tradewar
The commerce warfare that after rattled world markets has returned, and Bitcoin is a part of the battlefield this time.
On Oct. 15, President Donald Trump declared that the United States was now in a commerce warfare with China, saying:
“We’re in a [trade war] now. We have 100% tariffs. If we didn’t have tariffs, we’d don’t have any protection. They’ve used tariffs on us.”
This affirmation cements per week of stress after he threatened to slap 100% tariffs on Chinese imports.
Notably, that menace had signaled the beginning of a financial standoff with ripple results reaching deep into world markets.
As a outcome, conventional equities tumbled, whereas digital belongings erased roughly $20 billion in open curiosity inside 24 hours.
Data from CoinGlass exhibits that Bitcoin and Ethereum led the decline, extending what had already been one of many uncommon “pink Octobers” for the highest cryptocurrencies.
How does this influence Bitcoin?
Tariffs work like a stealth tax, making imports costlier, elevating enter prices, stoking inflation, and pressuring central banks to maintain rates of interest increased for longer. That mixture typically drains liquidity from danger belongings like Bitcoin.
In 2018, comparable tariff bulletins triggered waves of volatility that pushed Bitcoin under $6,000. The sample is repeating in 2025.
Institutional traders are regularly shifting towards defensive positions in gold, Treasury payments, and short-duration bonds.
On the opposite hand, Bitcoin, which nonetheless trades like a high-beta macro asset, turns into collateral harm in that flight to security.
Yet, the state of affairs now carries an added layer of complexity.
Unlike the 2018 cycle, Bitcoin is not a retail-driven instrument however a regulated asset class with deep ETF publicity and clear derivatives markets.
Still, CoinShares‘ head of analysis James Butterfill had warned in February that the fast influence of tariffs could be “undeniably damaging” for Bitcoin.
Butterfill defined that tariffs sluggish development, elevate inflation expectations, and spark danger aversion. In this market state of affairs, Bitcoin reacts to liquidity tendencies, leading to short-term volatility.
Already, merchants more and more consider that the probabilities of a continued Bitcoin uptrend are slim this month.
On Polymarket, the chances of Bitcoin hitting $130,000 by month’s finish fell under the likelihood of it retreating to $95,000, reflecting how macro coverage is dictating digital-asset sentiment.
However, Butterfill additionally identified that the highest crypto recovers sooner than equities in a stagflation state of affairs.
He stated:
“In the long run, Bitcoin’s function as a hedge might be strengthened, particularly if tariff insurance policies result in financial instability.”
Structural shift
Meanwhile, analysts at Bitunix informed CryptoSlate that Trump’s affirmation has escalated the 2 nations’ financial confrontation and reshaped world danger urge for food.
The impact, they stated, is twofold: a short-term liquidity shock and a medium-term structural pivot in how capital views decentralized belongings.
In the fast time period, heightened uncertainty drives establishments to de-risk. Funds rebalance towards money equivalents and gold, sparking broad sell-offs in high-liquidity markets like crypto.
According to them, leveraged merchants going through margin calls would speed up the cascade. Notably, that’s exactly what triggered last week’s $20 billion liquidation wave.
But past the preliminary turbulence lies a unique calculus. If the commerce warfare stays restricted to tariffs and export controls, weaker world development may depress crypto demand.
However, Bitcoin may reemerge as a geopolitical hedge if the confrontation extends into monetary settlement programs. In this example, the US would possibly introduce restrictions on cross-border greenback entry or fee rails, forcing traders to hunt alternate options.
In that state of affairs, digital belongings transition from “danger belongings” to “different reserves.” As the Bitunix staff defined:
“The erosion of confidence within the US greenback system may reinforce Bitcoin’s narrative as a ‘de-dollarization’ and ‘different worth reserve’ asset, creating structural help.”
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