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Market Update: Bitcoin and Ethereum Prices React to Trade War Concerns

Bitcoin Price Gains 7% Amidst Trade War Concerns

Bitcoin’s price has gained 7% early Wednesday, trading just below $90,000, as investor optimism grows that punishing U.S. tariffs on Canada and Mexico could be avoided.

Ethereum Price Recovers 6.1% to Send ETH Above $2,200

Ethereum’s price has recovered 6.1% to send ETH above $2,200, according to CoinGecko data.

Trade War Concerns

U.S. Commerce Secretary Howard Lutnick told Fox News on Tuesday that President Donald Trump will “probably” announce a trade compromise with Canada and Mexico as early as today. If that happens, it will lessen the blow of what otherwise would have been a new 25% tariff on two of the country’s top trading partners.

Market Reaction

At the time of writing, Bitcoin is trading for $89,970.57 after having gained 7.7% in the past day. Major stock indices, such as the S&P 500 and the Dow Jones Industrial Average, posted 1.2% and 1.5% losses on Tuesday, respectively. Bitcoin slipped below $82,000, erasing the gains seen since Trump returned to the White House.

Investor Sentiment

Investors could be forgiven for feeling a sense of déjà vu. It was only last month that the U.S. stalled its punishing tariffs with Canada and Mexico, but still had to mend its fractured trade agreement with China. The same is true this time around.

China’s Stance

China has vowed not to back down, with Chinese Foreign Ministry Spokesman Lin Jian tweeting, “If war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end.”

Analyst Opinion

BRN analyst Valentin Fournier wrote in a trading note, “This aggressive stance risks isolating the U.S. and slowing regional economic growth. If sustained, these policies could lead to higher inflation, reduced growth, and tighter liquidity—factors that would weigh heavily on Bitcoin and other digital assets.”

Crypto Markets

Singapore crypto trading firm QCP Capital characterized crypto markets as “nothing short of a roller coaster,” in its daily markets note. The firm added that as long as macro conditions like trade wars remain viable threats, “crypto remains highly linked to equities, with price action reflecting broader economic shifts.”

Conclusion

The trade war concerns have sent shockwaves through the markets, with Bitcoin and Ethereum prices reacting accordingly. While the news of a potential trade compromise between the U.S. and Canada/Mexico has sparked optimism, the overall sentiment remains cautious. The market is waiting for concrete developments, and investors are holding their breath as the situation unfolds.

FAQs

What is the current price of Bitcoin?

$89,970.57

What is the current price of Ethereum?

$2,200

What is the potential impact of the trade war on cryptocurrency markets?

The trade war could lead to higher inflation, reduced growth, and tighter liquidity, which would weigh heavily on Bitcoin and other digital assets.

What is the stance of China on the trade war?

China has vowed not to back down, with Chinese Foreign Ministry Spokesman Lin Jian tweeting, “If war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end.”

What is the opinion of analysts on the trade war?

BRN analyst Valentin Fournier wrote in a trading note, “This aggressive stance risks isolating the U.S. and slowing regional economic growth. If sustained, these policies could lead to higher inflation, reduced growth, and tighter liquidity—factors that would weigh heavily on Bitcoin and other digital assets.”