"Bitcoin Falls Below $100,000 Amid Escalating US Tariff War with China, Canada, and Mexico"
Bitcoin has fallen below the $100,000 mark for the first time in six days, following the announcement that US President Donald Trump has signed an executive order to impose additional tariffs on imports from China, Canada, and Mexico. The move, which aims to address issues such as illegal immigration and the flow of harmful substances like fentanyl, has already sparked retaliatory actions from the three nations, leaving the cryptocurrency community uncertain about how these developments will impact the broader market.
On February 1, the White House issued a statement outlining the new tariffs. According to the release, Trump has implemented a 25% additional tariff on goods from Canada and Mexico, with a 10% tariff on imports from China. However, energy resources coming from Canada will be subject to a lower 10% tariff.
Swift Response from Canada, China and Mexico
The announcement of these tariffs was met with swift responses from the affected countries. Canadian Prime Minister Justin Trudeau held a press conference, revealing that Canada would impose a 25% tariff on $106.5 billion worth of US goods. In China, the Ministry of Commerce responded by stating it would file a complaint with the World Trade Organization (WTO) and take appropriate countermeasures. Mexico’s President Claudia Sheinbaum also expressed her displeasure, instructing the Secretary of Economy to implement a “Plan B” which would include both tariff and non-tariff measures to protect Mexico’s interests.
These retaliatory actions, coupled with the broader economic uncertainty surrounding the tariffs, have contributed to Bitcoin’s price drop. For the first time since January 27, the cryptocurrency fell below the $100,000 threshold, dipping to $99,111. As of the time of publication, Bitcoin was trading at $99,540, according to data from CoinMarketCap. Furthermore, CoinGlass data revealed that $22.7 million in long positions were liquidated in the four hours leading up to this price change.
Crypto Community Divided on the Imposed Tariff
The crypto community is divided on how significant the impact of these tariffs will be on the market. Some, like Dan Gambardello, founder of Crypto Capital Venture, downplay the idea that Trump’s tariffs and memecoins are to blame for the end of the current bull cycle. Gambardello argued that major institutional players, like BlackRock, continue to accumulate Bitcoin and Ethereum, while retail investors panic over temporary price fluctuations. He believes that this volatility is simply part of the crypto market’s ongoing consolidation phase.
Others, like Jeff Park, head of alpha strategies at Bitwise Invest, see potential for Bitcoin to benefit in the long run from a sustained tariff war. However, not all commentators share this optimistic view. Adam Cochran, a partner at Cinneamhain Ventures, cautioned that Bitcoin is still too closely tied to the global markets and currently trades like highly leveraged tech stocks. According to Cochran, the economic strain caused by the tariffs could hurt everyone, including Bitcoin investors, and he suggested that it might be time to acknowledge the pain that comes with such economic upheavals.
Conclusion
In summary, Bitcoin’s decline below the $100,000 mark follows a tense geopolitical situation, with tariffs escalating between the US, China, Canada, and Mexico. The crypto market is divided on the potential long-term effects of these developments, with some industry figures remaining bullish while others express concern about the broader economic consequences.
