In reaction to China tightening its export-controls on rare earths on 9 October, on the following day the Trump Administration announced new 100% retaliatory tariffs on Chinese imports alongside tighter export controls on advanced U.S. technologies.
The sudden escalation took both traditional and crypto markets off guard. Crypto exchanges experiencing forced multi-billion-dollar liquidations of leveraged longs – with USD 7bn reported in the first hour. Although Bitcoin dropped by roughly 10% in the 24 hours following the announcement, it was relatively resilient compared to altcoins.
However following President Trump’s Truth Social post on Sunday, saying “Don’t worry about China, it will be all fine”, the crypto markets commenced a rally in response to potentially easing trade-war fears. Bitcoin edged up 3% with a more pronounced recovery in altcoins, with several of the major altcoins gaining back some lost ground.
In today’s CIO view by Fabian Dori, read about the market reaction and get insights into how macro and crypto drivers are shaping up his mid-term outlook.
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