Crypto traders should expect ‘continued volatility’ as Trump prepares more tariffs, analysts warn

Analysts say crypto is in for more choppy waters as President Donald Trump keeps piling on tariffs.

The White House imposed 25% tariffs on Canada and Mexico and a 10% levy on China. Canada responded with its own 25% tariff on $106 billion of U.S. goods, with Mexico likely to follow.

Analysts at Singapore-based crypto trading firm QCP Capital wrote in a Feb. 3 note that Treasury yields bear-flattened, with 2-year yields rising while 10-year yields fell, signaling short-term inflation concerns and “long-term trade war” risks. Equities dropped, gold prices fluctuated, oil spiked, and crypto saw sharp sell-offs.

QCP Capital thinks the uncertainty will stick around as President Donald Trump gears up for talks with Canada and Mexico and keeps hinting that new tariffs on the European Union will “definitely happen.” Speaking to reporters Sunday night, Trump repeated his warning to the E.U., saying tariffs are definitely on the table because of a big trade deficit with the bloc.

“They don’t take our cars, they don’t take our farm products. They take almost nothing, and we take everything, and then millions of cars, tremendous amounts of food and farm products,” Trump said of the E.U.

QCP Capital’s analysts say the decorrelation “reinforces the view that today’s risk-off move is driven by cross-asset portfolio rebalancing rather than a single-asset event.” They also noted the growing gap between New York and London gold prices, which could mean traders are unwinding popular carry trades or facing issues moving gold between vaults.