Bitcoin slipped below $100k for the second day in a row after China’s retaliatory tariffs against the US put a hold on its spirited recovery after the early Monday crash.

After crashing by close to 10% and settling around $92k on Monday, Bitcoin witnessed a speedy recovery that sent it back above $100k by Monday evening after Canada, Mexico, and the US agreed on a 30-day moratorium on the Trump Tariffs.

CoinMarketCap:  Bitcoin price action on Tuesday, Feb. 4

However, the US didn’t extend the tariffs pause to China and the Asian economic giant responded by imposing retaliatory levies of 10% and 15% on such US products as coal, oil, natural gas, and agricultural equipment. 

The announcement re-ignited fear and uncertainty among crypto investors.

While it wasn’t as impactful enough to force the liquidation of $2.2 Billion worth of crypto trades, it was enough to dent BTC’s recovery and push its price below $98,000 during the early Tuesday morning trades of the Asian market.

Risk-off Mood Grips the Crypto Markets

Bitcoin investors have been largely bullish about the long-term effects of the Trump presidency on the legacy coin and the market at large.

The optimism is evidenced by the extreme greed crypto community sentiment and Bitcoins rally to a new all-time high of $109,114.

They, however, are also cautious about the impact that Trump’s pronouncements and executive orders will have on Bitcoin price in the short-to-medium term.

In reaction, crypto investors have turned towards safer crypto investments like Bitcoin, effectively pushing its dominance level to early 2021 levels – above 60%, having increased by as much as 4.58% in the last 24 hours. 

CoinMarketCap: Bitcoin dominance

Over the past two days, the sweeping liquidations have also injected fear and cautious trading among Bitcoin investors.

For example, in the last 24 hours, close to $500 Million worth of crypto trades have been liquidated. 

Coinglass: Crypto market liquidation heat map

This adds to the more than $2.2 Billion liquidated on Monday. The cautious trading activity has seen the daily crypto market trading volume shrink by more than 32% to $277 Billion.