China has announced it will significantly raise tariffs on selected US imports from 34% to 84%, effective April 10 at 12:01 P.M. Beijing time.
This sharp escalation is a direct response to Washington’s decision to increase its tariffs on Chinese goods just two days earlier.
According to the Chinese government:
“The US’s practice of escalating tariffs on China is a mistake on top of a mistake, which seriously infringes on China’s legitimate rights and interests and seriously damages the rules-based multilateral trading system. “
The news had little impact on Bitcoin, which has been trading at $76,298, down 4% in the past 24 hours.
Will China dump US dollars for Bitcoin?
Meanwhile, China is not only retaliating with tariffs but also making quiet moves in the financial sector.
Reports indicate that the People’s Bank of China (PBOC) has instructed major state-owned banks to reduce US dollar purchases, especially for internal trading.
Additionally, there are growing reports that China may begin selling off its US Treasury holdings.
China remains the second-largest foreign holder of American debt securities, with over $760 billion in these assets. A large-scale sell-off could raise the US’s borrowing costs, especially with a Treasury auction on the horizon.
Venture capitalist Chamath Palihapitiya suggested the rumored asset sales might be strategic noise to stir uncertainty. However, he acknowledged that if China does follow through, the consequences could be significant, possibly forcing the US to delay its bond issuance.
So, as the traditional markets brace for further instability, investors are looking elsewhere for safety.
Bitcoin, often seen as a hedge during financial stress, is again drawing attention. Analysts believe prolonged trade tensions and weakening trust in fiat currencies could push capital into digital assets.
Sina G, co-founder of crypto investment firm 21st Capital, said:
“Bitcoin isn’t just a hedge anymore. It’s becoming a necessity in a world looking for stability outside the control of any one nation.”
