Emre Yumlu 
U.S. President Donald Trump has reaffirmed plans to impose a 130% tariff on Chinese imports starting November 1. In addition, new export controls on critical software technologies will come into effect. These measures are seen as a direct response to China’s restrictions on rare earth exports, signaling a renewed escalation in the long-standing trade conflict between the world’s two largest economies.
A New Chapter in the U.S.–China Trade War
The Trump administration’s strategy aims to reduce China’s dominance in global supply chains. Currently, China accounts for 70% of global rare earth production and 93% of permanent magnet manufacturing—key materials used in defense, technology, and AI infrastructure.
The updated export controls now extend to AI and blockchain-related software, potentially disrupting existing collaborations between American and Chinese tech firms.
Ripple Effects on Crypto: Mining Equipment Costs May Rise
The escalating trade tensions could indirectly impact the crypto market as well. Cryptocurrency mining relies heavily on semiconductors, AI-based systems, and advanced hardware—all of which could become more expensive under the new tariff regime.
Reports suggest that several Chinese mining equipment manufacturers have already begun establishing production facilities in the U.S. to mitigate future import-related risks.
Historical Data: Trade Disputes Tend to Pressure Risk Assets
Looking back, history shows that trade conflicts often lead to selling pressure on risk assets. During the 2018–2019 U.S.–China trade war, both equity and crypto markets experienced heightened volatility and sharp corrections.
Experts warn that the latest developments could similarly fuel short-term uncertainty, driving investors toward safe-haven assets such as gold and stablecoins.
Analysts Warn of Rising Volatility Amid Low Liquidity
Market analysts caution that weekend trading—often characterized by lower liquidity—could amplify volatility. Should China retaliate, the current bearish momentum in crypto markets may persist into the coming week.
In the long run, however, these economic frictions could accelerate decentralization within the crypto sector. A more geographically diverse mining ecosystem might emerge as global operations adjust to ongoing geopolitical and trade disruptions.
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