Trump Warns China with 155% Tariff Threat as Australia Deal Signed — Are We Facing a Market Crash by November?

Trump Warns China with 155% Tariff Threat as Australia Deal Signed — Are We Facing a Market Crash by November?

U.S. President Donald Trump has heightened global trade tensions by threatening a 155% tariff on Chinese products unless a new trade agreement is reached by November 1. This announcement coincided with a mineral agreement signed with Australia aimed at mitigating China's influence in global supply chains. In the wake of these threats, financial markets, including cryptocurrencies, have experienced significant sell-offs.

Key Takeaways

Trump proposes a 155% tariff on Chinese goods if a trade deal isn't finalized by November 1.
A critical minerals agreement with Australia aims to decrease reliance on China.
Financial markets, including cryptocurrencies, have reacted negatively to the tariff announcements.
Bitcoin and Ethereum have seen major liquidations, causing a significant downturn in prices.

Trump’s Tough Stance Against China

U.S. President Donald Trump has sparked renewed global trade tensions by threatening to impose tariffs of up to 155% on Chinese goods starting November 1 if a new trade agreement is not reached with Beijing. This announcement was made during a meeting at the White House with Australian Prime Minister Anthony Albanese, where they signed an important minerals agreement to counter China's dominance in global supply chains.

Trump accused China of taking advantage of the U.S. for years, asserting, "China’s paying 55 percent and a potential 155 percent come November 1 unless we make a deal." Despite his aggressive stance, Trump expressed optimism about making progress in negotiations, planning to meet with Chinese President Xi Jinping at the upcoming Asia-Pacific Economic Cooperation (APEC) summit in South Korea.

Could Tariffs Force China to Negotiate or Result in a Market Crash?

The timing of Trump's tariff threats coincided with the signing of the critical minerals agreement with Australia, which is part of a larger effort to reduce dependence on Chinese supply chains. The $8.5 billion deal represents a partnership in mining and processing rare earth materials, with both nations contributing $1 billion over six months. This agreement is crucial for securing Western access to resources essential for sectors such as defense, aerospace, and electric vehicles, which are heavily influenced by China.

Following these announcements, global markets reacted dramatically. Tariff threats and new export restrictions prompted a sell-off across various equity and crypto assets. As per data from CoinGlass, over $329.29 million in cryptocurrency positions were liquidated within just 24 hours, with Bitcoin and Ethereum experiencing significant declines, trading at around $107,800 and below $3,900, respectively.

Market reaction analysis
Source: CoinGlass

Existing Tariffs and Market Forecast

Trump's proposed 155% tariffs add onto the already established 55% duties on Chinese imports reinstated earlier this year. On October 11, the U.S. also announced new export restrictions on advanced software and a 100% tariff escalation effective November 1. Together, these actions have unsettled the markets, triggering fears of a broader economic slowdown.

The financial repercussions were swift, with over 1.66 million crypto traders facing liquidation, leading to a loss of $19.33 billion in leveraged positions, marking the highest liquidation record in crypto history.

🇺🇸 Trump’s tariff threat triggered $19 billion in crypto liquidations, showcasing risks linked to leverage before Bitcoin rebounded above $114K. #trump #tariff source
— Cryptonews.com (@cryptonews) October 13, 2025

Beijing responded to the tariff warnings with its own tightening of export controls on rare earth materials, critical for advanced technological production. China's foreign ministry indicated that tariffs would not foster positive engagement, leading to a shakeup in its trade negotiation team, signaling a new approach to upcoming talks.

Cryptocurrency Market Impact

Analysts suggest that a prolonged trade war between the U.S. and China could increase consumer prices globally, destabilize stock markets, and limit access to key industrial materials. In the digital market realm, volatility is expected to continue, especially if negotiations falter.

There are concerns that high tariffs could further strain U.S.-China relations, impacting crypto markets significantly. Many Bitcoin mining operations rely on hardware from China, meaning increased tariffs could lead to higher costs for equipment and disrupt supply chains, ultimately reducing global mining output.

Bitcoin market trends
Source: Cryptonews

After trading above $111,000 early Monday, Bitcoin fell back to $107,871, marking a 3% decrease within 24 hours and nearly 13% over the last two weeks. Ethereum has similarly struggled, dropping below the $4,000 mark to around $3,872 amid selling pressure linked to ETF outflows and weak buying activity.

Technical analysts currently view $3,800 as a crucial support level, with the possibility of further declines if prices do not stabilize. Traders assert that Bitcoin's support between $107,000 to $108,000 is critical, with risks of falling towards $100,000 if market uncertainty persists.

“If Bitcoin loses the $107,000 mark, it could drop toward $100,000,” warned trader TedPillows.

Ethereum market dynamics
Source: Cryptonews

However, the upcoming discussions between Trump and Xi might present an opportunity for resolution. Treasury Secretary Scott Bessent suggested that both countries could engage in more talks before the summit, possibly in Malaysia, aimed at addressing differences. Trump was optimistic, stating, “I think when we finish our meetings in South Korea, China and I will have a really fair and really great trade deal together.”

In tandem, the U.S. Export-Import Bank announced $2.2 billion in investments to support Australian mining endeavors. This initiative targets rare earth and other critical minerals used in defense and communications, aiming to further decrease reliance on China.

Despite these moves, the financial repercussions of Trump's tariffs are becoming evident, with global firms reporting over $35 billion in costs associated with U.S. tariffs this year. Although tariff revenues have marginally reduced the U.S. budget deficit, down to $1.78 trillion for fiscal year 2025, analysts caution that consumers and businesses are experiencing the brunt of increased prices.