Hey all, Liam here. 

It’s been a blood red week for digital coin enthusiasts.

In the last seven days, Bitcoin and Ethereum have plummeted some 13% since US President Donald Trump threatened 100% tariffs on Chinese goods. 

He’s walked that back since, and even confirmed that such strict import taxes wouldn’t be “sustainable,” but crypto investors aren’t buying it. 

On Friday morning, the wider crypto market shed another $200 billion, according to CoinGecko. The move also liquidated another $1 billion in levered traders. 

Meanwhile, gold continues to hit new highs. 

A brewing trade war, combined with the ongoing US government shutdown and institutional investors' flight from spot crypto exchange-traded funds, has put the market well into risk-off territory. 

“It feels like 2017’s China FUD all over again, specifically the ‘U’ phase – Uncertainty,” Connor Howe, the founder of Enso, told me this week.

“It’s too soon to say that the entire market’s flipped bearish, but Uptober at the very least has been placed on ice.”

Still, at least a few daring traders are returning to the market. 

“Despite the prevailing bearish sentiment, our data suggests many traders view the sell-off as overdone and are cautiously positioning for potential upside,” Alexia Theodorou, Head of Derivatives at Kraken, told me today. 

Elsewhere, data from Glassnode, a crypto analytics platform, shows a dense cluster of call options around the $130,000. 

This suggests that a few especially bullish traders expect Bitcoin to jump another 22% before the year’s out. 

Meanwhile, investors are also looking forward to the US Federal Reserve’s next policy meeting on October 29, and a new trade deal with China should be inked before November 10, when a 90-day tariff truce officially ends between the two countries.

Interesting times indeed.

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DL News is an independent news organisation that provides original, in-depth reporting on the largely misunderstood world of cryptocurrency and decentralised finance. From original stories to investigations, our journalism is accurate, honest and responsible.