Trump announces a 25% tariff on Japan and South Korea, causing Bitcoin to drop sharply.
Former U.S. President Trump released two letters (Letter 1, Letter 2) on the Truth Social platform on Monday, announcing that he will impose a 25% tariff on Japan and South Korea, reigniting market concerns about a trade war. Trump pointed out in the letter that trade between the U.S. and these two countries has been unfair, leading to a trade deficit for the U.S. This tariff policy will take effect on August 1, delayed from the original deadline of July 9.
Affected by the tariff news, Bitcoin's price dropped sharply, retreating from a high of $109,700 on Sunday to around $107,700, falling 0.8% within 24 hours, briefly dipping below the psychological barrier of $108,000. (As of the time of writing, Bitcoin's price is $107,522). This wave of decline completely erased the modest gains made over the weekend, showing the market's sensitive reaction to uncertainty in trade policy.
In addition to Japan and South Korea, Trump also announced tariff plans for other countries in subsequent posts. Kazakhstan and Malaysia will face a 25% tariff, South Africa 30%, and Myanmar and Laos as high as 40%. Trump also threatened to impose additional tariffs on countries aligned with BRICS group policies.
The crypto market is broadly weakening, with traditional markets also declining.
The drop in Bitcoin has led the entire cryptocurrency market to weaken, with Ethereum falling 0.6%, and other smaller cryptocurrencies such as Solana's $SOL, Dogecoin $DOGE, and Sui's $SUI all dropping between 1% and 2%. The only standout performer is $XRP, which rose more than 2%.
This wave of tariff news not only impacts the crypto market but also affects traditional financial markets. The Nasdaq and S&P 500 indices both fell about 1% on Monday, while the yield on the 10-year U.S. Treasury bond rose to nearly 4.4%.
Looking back at the initial emergence of Trump's tariff issue in April this year, Bitcoin had sharply dropped to a low of $78,000, then recovered and hit a historical high in May. Now, with the tariff threat heating up again, the market is worried about a possible repeat of previous extreme volatility.
The White House confirms that more countries will receive tariff notifications.
White House Press Secretary Karoline Leavitt confirmed at a media briefing that approximately 12 other countries will directly receive notifications and letters from President Trump. She stated that the government is seeking to achieve the best trade agreements for the American people and American workers.
The delay in the deadline brings a glimmer of hope to the market, meaning there is still a possibility of reaching more trade agreements before August 1. However, aside from Japan and South Korea, the U.S. has not yet reached trade agreements with major economies such as India and the European Union, which also face the risk of high tariffs. Market analysts warn that if tariffs escalate into a full-blown trade war, the cryptocurrency market could face greater downward pressure.
This article is collaboratively republished from: Crypto City
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