Bitcoin falls below USD $112,000 after China's response to US tariffs

By Hannah Perez

The cryptocurrency market reversed Monday’s gains after China took retaliatory action against the US over Trump’s tariffs. Bitcoin fell below USD $111,000 but recovers slightly.

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The cryptocurrency market reversed Monday’s gains after China’s retaliation.
China imposed trade restrictions on five US entities and new port fees.
Trump announced 100% tariffs on China on Friday, causing extreme turbulence for cryptocurrencies.
Bitcoin, which had risen above $115,000 on Monday, retreated following the latest developments.

Bitcoin (BTC) sank below $112,000 in early morning trading (ET), reversing Monday’s advance after China announced trade retaliation against the United States, promising to cause more turmoil in financial markets.

The data of CoinGecko show that the price of Bitcoin it retreated to a local low of USD$110,256 before a modest recovery. The pullback comes after an extreme volatility event in the cryptocurrency market on Friday, marked by unprecedented liquidations of more than $19 billion in 24 hours.

The chaos was triggered by President Donald Trump’s announcement at the end of the week, which threatened to impose a 100% tariff on products imported from China. The statements revived fears of a trade war and destabilized global markets.

Cryptocurrencies, which lost USD $500 billion in capitalization on Friday amid the bomb, had shown signs of recovery on Monday, with Bitcoin momentarily approaching USD $116,000; However, gains were sporadic and geopolitical events are still directly influencing prices.

Crypto market subtracts Monday’s gains

The cryptocurrency market records losses in the last 24 hours, with the capitalization 2.7% lower, according to CoinGecko. Ethereum (ETH) has fallen 3.4%, XRP 5% and Cardano (ADA) 2.4%. The BNB token, which has been on a bullish streak setting new highs in a row, leads the losses with a decrease of more than 9%, standing around USD $1,166.

Furthermore, other altcoins as Dogecoin (DOGE) and tron (TRX) also fell between 3% and 4%, while Solarium (SOL) is an exception among the widespread bloodbath with a modest 0.4% gain in the last 24 hours.

Exchange-traded funds (ETFs) Bitcoin and Ethereum spot in the United States reflected the downward trend, recording outflows of USD $326.5 million and USD $428.5 million, respectively, on Monday. The negative flows contrast with inflows of more than $3 billion last week and suggest investors are moderating their risk appetite amid trade policy developments between the US and China.

Liquidations in the cryptocurrency derivatives market surged to $648.28 million amid price reversal on Tuesday, although they remain moderate from recent peaks. The data of Coinglass show that, in the last 24 hours, some USD $452.68 million in long positions have been liquidated and USD $195.6 million in short positions.

China retaliates against the US

China’s response includes imposing restrictions on five US entities of Hanwha Ocean Co., a major South Korean shipbuilder, prohibiting any business with them, as reported Bloomberg. This move is part of an escalation in response to US restrictions on the Chinese maritime sector, including an investigation under Section 301 by the Office of the US Trade Representative.

Additionally, China implemented new port tariffs on U.S. ships arriving at Chinese ports, effective Tuesday, as a retaliatory measure against escalated U.S. trade actions, according to the BBC. These tariffs apply to US-owned, operated, built or flagged ships, but exempt ships built in China.

A spokesperson for the Chinese Ministry of Commerce stated: “China’s position is consistent. If there is a fight, we will fight to the end; If there is a talk, the door is open“, according to coverage.

Guardian reports that China has increased restrictions on rare earths and related technologies, citing national security concerns, and that US Treasury Secretary Scott Bessent stated that China wants “drag everyone else down with them” by damaging the global economy. Average U.S. tariffs on Chinese imports reached 58% as of Sept. 25, according to analysis by the Peterson Institute for International Economics.

Bitcoin below USD $112,000

These developments have impacted not only the cryptocurrency market, but also global markets. CoinDesk reports that Asian stocks fell, with Japan’s Nikkei down more than 3%, its worst session in almost two months, while futures contracts for the S&P 500 fell 0.7% and those for the Nasdaq 100 lost 1%. The actions of Hanwha Ocean They fell up to 8% in Seoul.

Escalating trade tensions between the world’s two largest economies have raised doubts about a possible meeting between Trump and his Chinese counterpart, Xi Jinping, at the Asia-Pacific Economic Cooperation summit in Seoul later this month, although Bessent believes it will still take place, according to reports.

At the close of this edition, BTC trades 2.4% lower in 24 hours at USD $111,233with a cumulative loss of more than 10% for the week and 11.6% below its all-time high of USD $126,000 recorded on October 6.

Article written with the help of AI, edited by DailyBitcoin

Image generated with an AI tool, under a free use license

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