Bitcoin Drops Below $100K as US-China Trade War Escalates
Fresh tariffs and market volatility hit crypto prices
Bitcoin (BTC) fell below $100,000 on February 4, dropping as much as 3.6% to $98,199, as renewed US-China trade tensions rattled financial markets.
Other major cryptocurrencies, including Ethereum (ETH) and Solana (SOL), also saw declines.
What’s Driving Bitcoin’s Decline?
US-China Trade War Intensifies
- The US imposed a 10% tariff on all Chinese imports, escalating tensions.
- China retaliated with tariffs on US oil and liquefied natural gas (LNG) and launched an antitrust investigation into Google LLC.
- Investor sentiment weakened, leading to a sell-off in risk assets, including Bitcoin .
Institutional Investors Pull Back
- On Monday, US investors withdrew $235 million from Bitcoin exchange-traded funds (ETFs).
- Open interest in Bitcoin futures on CME Group fell 4%, signaling reduced institutional confidence.
Volatility and Market Uncertainty
- BTC surged $10,000 in a single day after bouncing from $91,500, fueled by news that tariffs on Mexico and Canada would be delayed.
- Bitcoin quickly reversed gains after China’s retaliatory measures were announced.
- Analysts suggest BTC will need to hold $93K to remain on track for a new all-time high.
What’s Next for Bitcoin?
Despite short-term volatility, some analysts remain optimistic:
- Crypto trader Michaël van de Poppe expects new all-time highs (ATHs) in February, provided BTC stays above $93K.
- Funding rates in derivatives markets have turned negative for the seventh time this year—historically a bullish signal, according to CryptoQuant’s Axel Adler Jr .
With Bitcoin dominance near a four-year high, traders are closely watching economic and geopolitical developments to gauge the next move for BTC.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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