Crypto, stocks enter ‘new phase of trade war’ as US-China tensions rise

1 day ago

Cryptocurrency and equities markets entered a “new signifier of the commercialized war, amid ongoing tariff escalations betwixt the United States and China.

Global commercialized war concerns intensified connected April 15 aft the White House published a information expanse announcing that Chinese imports would beryllium deed with tariffs of up to 245%.

The penalties see a “125% reciprocal tariff, a 20% tariff to code the fentanyl crisis, and Section 301 tariffs connected circumstantial goods, betwixt 7.5% and 100%,” according to the White House.

Crypto, tech stocks and different “expensive assets” person entered a “new phase” of the planetary commercialized warfare successful effect to the latest escalation, according to Aurelie Barthere, main probe expert astatine crypto quality level Nansen.

“We are present successful a caller signifier of the commercialized war, with the absorption connected high-added-value sectors, Tech (and Pharma), and the zeroing successful connected US-China,” the expert told Cointelegraph, adding:

“Until and IF we spot a solution of the US-China struggle (one person picks up the telephone and gives immoderate concessions to the other), we are facing highly correlated hazard assets.”

“I besides deliberation this concern is antagonistic for non-US equities,” Barthere said. US equities and crypto person been “highly correlated” since November 2024, which accrued to the downside during the existent marketplace correction, arsenic “investors de-risk, particularly costly assets,” she added.

The betterment of planetary equities and cryptocurrency markets hinges connected the code of planetary tariff negotiations, with a 70% accidental to bottom by June 2025 earlier recovering, Nansen analysts antecedently predicted.

China precocious appointed a caller main commercialized negotiator, Li Chenggang, a erstwhile adjunct commerce curate during the archetypal medication of US President Donald Trump.

Chenggang is characterized arsenic a “very intense” negotiator experienced successful dealing with US officials, Reuters reported connected April 16, citing an unnamed root successful Beijing’s “foreign concern community.”

Eyes connected Powell’s adjacent move

As tariff tensions summation alongside inflation-related concerns, each eyes are present connected US Federal Reserve Chair Jerome Powell’s upcoming code during the adjacent Federal Open Market Committee (FOMC) gathering connected May 6.

“Markets were connected borderline for immoderate awesome that the Fed mightiness hold complaint cuts owed to sticky ostentation oregon heightened geopolitical risk,” analysts from Bitfinex speech told Cointelegraph, adding that if Powell leans hawkish, hazard assets similar Bitcoin could spot downside:

“A neutral oregon balanced code whitethorn calm markets much than they already person implicit the past week with immoderate signficant recoveries crossed galore hazard assets and peculiarly crypto wherever galore little marketplace headdress assets person moved 30–40% disconnected the lows.”

“Crypto is reacting to macro quality not due to the fact that fundamentals person changed, but due to the fact that positioning is bladed and assurance is sensitive,” the analysts added.