US and China Strike 90-Day Trade War Truce: Tariffs Cut by 115%

In a bold move, the United States and China have paused their escalating trade war, sparked by former President Donald Trump’s aggressive tariff hikes.

Announced after intense talks in Geneva, the 90-day truce slashes reciprocal tariffs by 115%, calming global markets and sparking hope among Bitcoin investors. US Treasury Secretary Scott Bessent praised the talks, saying, “Neither side wants a decoupling.”

For Bitcoin Magazine NL readers, this deal could stabilize crypto markets while keeping Bitcoin’s role as an economic hedge in focus.

A Ceasefire Amid Economic Turmoil

The agreement, finalized on May 12, 2025, halts a trade war that risked destabilizing the global economy. It targets tariffs imposed by Trump on April 2, 2025, which soared to 125% on Chinese imports. China retaliated with matching duties and non-tariff measures, such as restricting exports of critical minerals essential for US high-tech manufacturing. US Trade Representative Jamieson Greer called China’s response “disproportionate,” accusing Beijing of imposing an “effective embargo” on trade between the world’s two largest economies.

Under the truce, Chinese duties on US goods will fall to 10%, while US tariffs on Chinese imports will drop to 30%. A pre-existing 20% US tariff, linked to China’s alleged role in the fentanyl crisis, remains in place. This partial rollback aims to ease economic pressures, from US inflation and empty shelves to China’s estimated 16 million jobs at risk.

China’s Ministry of Commerce spokesperson welcomed the deal: “This move meets the expectations of producers and consumers in both countries, and the interests of both nations and the common interest of the world.” They urged the US to “wholly correct the erroneous practice of unilateral tariff hikes” and foster “mutually beneficial cooperation.”

Global Markets and Bitcoin’s Outlook

The announcement reverberated across markets. China’s yuan hit a six-month-high, signaling investor relief. European indices rallied, with Germany’s DAX climbing 1.5%—led by Mercedes-Benz, Daimler Trucks, and BMW—and France’s CAC rising 1.2%. William Xin, chair of Spring Mountain Pu Jiang Investment Management, told Reuters, “The result far exceeds market expectations. Both China stocks and the yuan will be in an upswing for a while.”

For Bitcoin Magazine NL’s audience, the truce presents a nuanced picture. Reduced economic uncertainty may curb Bitcoin’s short-term volatility, as traditional markets stabilize. However, Bitcoin’s appeal as a decentralized hedge against fiat-driven trade wars could soften if tensions ease. Yet, a stable economy might attract institutional investors to crypto, seeking diversified portfolios. As Bitcoin thrives in uncertainty—its fixed supply and borderless nature shining during geopolitical storms—this truce could set the stage for new crypto opportunities.

Voices from the Negotiations

The talks weren’t just about tariffs; they carried human stakes. Bessent highlighted China’s engagement on the fentanyl crisis, a persistent US concern. “For the first time, the Chinese side understood the magnitude of what is happening in the US,” he said, hinting at rare mutual understanding.

In China, reactions varied. Hu Xijin, former editor of the nationalist Global Times, hailed the deal on Weibo as a “great victory for China in upholding the principles of equality and mutual respect.”

He contrasted it with a recent UK-US trade deal, which retained a 10% US tariff on UK imports without reciprocal UK measures. Wang Wen, head of the Chongyang Institute for Financial Studies at Renmin University, called the truce an “unexpected achievement” but cautioned, “It does not represent the resolution of the structural contradictions between China and the United States.”

A Joint Pledge, But Uncertainty Looms

A joint US-China statement emphasized collaboration: “Both sides will continue to advance related work in a spirit of mutual openness, continuous communication, cooperation, and mutual respect.”

Yet, as Wang Wen noted, deep tensions persist—fentanyl disputes, trade imbalances, and technological rivalry remain unresolved. For Bitcoin investors, these fault lines suggest that economic volatility, and Bitcoin’s relevance, may endure.

Key Insights for Bitcoin Investors

• Market Stability vs. Crypto Appeal: A calmer economy could reduce Bitcoin’s volatility but attract institutional investors seeking stable crypto entry points.
• China’s Crypto Influence: Despite domestic crypto bans, China’s economic moves impact Bitcoin’s global price. A stronger yuan may ease Bitcoin’s role as a regional hedge.
• Geopolitical Risks: The unresolved fentanyl issue keeps US-China ties fragile, potentially boosting Bitcoin demand if tensions flare.
• SEO Keywords: US-China trade war, Bitcoin investment, tariff truce, global markets, cryptocurrency hedge.

How do we move forward?

The 90-day US-China trade war truce is a diplomatic triumph, cutting tariffs by 115% and offering relief to a strained global economy. For Bitcoin Magazine NL readers, it’s a moment to reassess strategies.

While stabilized markets may temper Bitcoin’s volatility, the “structural contradictions” Wang Wen highlighted ensure crypto’s role as a hedge persists. As Scott Bessent noted, “Neither side wants a decoupling,” but the path forward is uncertain.

Bitcoin investors should stay vigilant—in a world of fiat battles, decentralized assets often shine brightest.

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