Cryptocurrency markets are showing notable relief this Friday, October 17th. Bitcoin’s reaction to China tariffs was immediately positive. This optimism stems from US President Donald Trump significantly softening his trade stance. During an interview with Fox News, Trump clarified that the feared 100% tariffs on Chinese goods “will not be maintained.”
Trump’s clarification comes at a moment of maximum tension. Just last week, the announcement of aggressive new tariffs shook global markets. That threat triggered a strong risk-off sentiment. As a result, assets like Bitcoin and Ethereum experienced notable drops. Investors feared an escalation of the trade war to levels not seen since 2019.
However, Friday’s comments change the landscape. Trump was asked directly if a 100% tariff could be sustained. His response was negative, adding that such a measure “would not be sustainable.” Although he maintained a tough tone, referring to China as a “very strong adversary,” the market focused on the de-escalation. “I think we’re going to do very well with China,” the president noted.
The US president also confirmed plans to advance negotiations. He announced an upcoming meeting with Xi Jinping in South Korea. This summit will take place in two weeks. The confirmation of diplomatic dialogue, combined with the reduced tariff threat, is key. It is being interpreted as a sign of de-escalation.
The trade dispute has been a constant source of macroeconomic uncertainty. This global uncertainty directly affects risk appetite. Assets like cryptocurrencies, which rely on investor sentiment, suffer in environments of high geopolitical tension. Therefore, any sign of relief is positively received by the digital economy.
Is Macro Uncertainty Over for Risk Assets?
The crypto market’s response was almost instantaneous. Following Trump’s statements, Bitcoin (BTC) registered a rally of nearly 2% on the 1-hour chart. This movement is significant, as it reverses some of the previous week’s losses. The price action was followed by other major cryptocurrencies, showing widespread positive momentum.
This rally underscores how crypto markets are deeply connected to macroeconomic events. They no longer operate in isolation. Bitcoin’s reaction to China tariffs demonstrates that crypto traders are closely monitoring trade policy. A more stable trade environment is perceived as beneficial for capital inflows into the sector.
While the market is celebrating Trump’s moderation, caution still prevails. The current relief is palpable, but the underlying volatility has not disappeared. Investors are now focusing their attention on the upcoming summit in South Korea.
The outcome of that meeting will be decisive. Tangible progress could solidify the current rally in risk assets. Conversely, a failure in negotiations could return uncertainty and selling pressure to the markets. Bitcoin’s reaction to China tariffs will remain a key barometer of investor sentiment.
