Ethereum soared on Sunday, jumping 8% in one day to regain the $4,000 level and trade at $4,111, CoinGecko data showed.
This rally came less than 24 hours after the token fell to $3,861. At that time, global markets collapsed under the weight of fears of a new trade war and what is now the largest single-day crypto liquidation in history.
As reported by Cryptopolitan, the disaster occurred late Friday, just after Wall Street closed for the weekend, leaving the vaunted cryptocurrency market, which operates 24/7, to deal with panic.
Interestingly, the crash now appears to be a complete misunderstanding between President Donald Trump and President Xi Jinping. At 8:30 a.m. ET on October 9, China quietly announced new export restrictions on rare earth minerals, but they were not bans.
The rule simply required export applications to “meet the regulations.” For more than a day, the news barely moved the market. Traders in stocks, oil and cryptocurrencies then hit the sell button after President Trump criticized the Chinese government in a social post for restricting vital exports.
As the White House softens its stance, China makes clear
The Chinese government sought to calm Washington on Saturday night by clarifying that its new export policy is not an embargo and that eligible shipments will still be approved. This clarification helped ease global tensions and restore investor appetite.
President Trump's previous posts about 100% tariffs on Chinese goods suddenly looked like political theater. Analysts currently view the likelihood of such tariffs being imposed as “extremely low.”
President Trump also took a different tone, writing to Truth Social: “Don't worry about China. Everything will be fine! The esteemed President Xi has just hit his worst moment. He doesn't want to panic his country and neither do I. America wants to help China, not hurt it!!! President DJT.”
By Sunday, his administration appeared to be backtracking. The White House has signaled it is open to a deal with Beijing aimed at easing tensions that have escalated since Friday. Vice President J.D. Vance urged China to “choose the path of reason” and said that prolonged conflict would further increase President Trump's influence.
U.S. Trade Representative Jamieson Greer described China's export measures as a “power grab” but said talks would continue. “It's clear to everyone that this Chinese takeover of power will not be tolerated,” Greer said on Fox News. Sunday briefing session.
He added that markets were reacting normally and that “these measures have not yet been introduced,” predicting that the situation would stabilize as traders became aware of the actual timeline for action.
President Trump's Friday announcement promised 100% tariffs, restrictions on exports of U.S. software and possible suspension of aircraft parts starting Nov. 1, but then he said, “We'll have to see what happens. That's why we made it Nov. 1. We'll see what happens.”
China's Commerce Ministry quickly responded, telling the US government to end its threat of new tariffs and return to negotiations to “resolve outstanding trade issues.” Officials noted that some new export restrictions will not take effect until November and may not be fully enforced.
Vance later told Fox News that he spoke to Trump twice over the weekend. “The president is grateful for the friendship he has cultivated with President Xi,” he said. “We have a lot of influence, and my hope, and I know the president's hope, is that we don't have to use that influence.”
