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Crypto market falters: trade conflict between USA and China unleashes panic!
The crypto market is declining due to the trade conflict between China and the USA. Bitcoin loses; extensive market analyzes follow.
Crypto market falters: trade conflict between USA and China unleashes panic!
The ongoing trade conflict between China and the US is clearly reflected in the cryptocurrency market. Although a preliminary agreement was reached between the two nations two weeks ago, a final resolution of the differences will not be reached until summer 2023 at the latest. US Treasury Secretary Scott Bessent warns that both US and Chinese leaders must actively intervene to reach a final agreement. Otherwise, the risk of economic tensions escalating again is high, leading to further pressure on financial markets bitcoin-2go.de reported.
The economic tension has already led to significant price losses in the crypto market. Today, the Bitcoin price is at $105,320, down almost 3%. The total value of all cryptocurrencies fell by 3.59% to $3.31 trillion. Altcoins such as XRP, which lost 4.33% and Dogecoin, which lost 9.13%, are also particularly affected. Notably, Bitcoin recently hit a record high of $111,970 on May 22, only to fall rapidly.
Impact of tariffs and geopolitical tensions
The Trump administration's recent decisions to impose high tariffs on Chinese goods are impacting both traditional markets and the crypto market. Tariffs of up to 145% on select products prompted a direct response from China, which in turn imposed 125% tariffs on US goods. Loud it-boltwise.de These developments led to a short-term decline in the price of Bitcoin, which fell from $80,000 to $76,500 before stabilizing below $78,000.
In this uncertain market situation, traditional indices such as the S&P 500 and Nasdaq also suffered losses, while the offshore yuan fell to its weakest level in years. Analysts speculate that a possible devaluation of the yuan could increase demand for Bitcoin, as investors have often shifted capital into cryptocurrencies to protect themselves in the past.
Volatile market conditions
Overall market volatility remains high, compounded by geopolitical tensions and fears of a global economic slowdown. Arthur Hayes, an analyst, points out that devaluations of the yuan in the past have often been accompanied by increased demand for Bitcoin. However, it remains to be seen how the situation will develop and whether the necessary interventions by heads of state will be enough to calm the markets.