Investor sentiment turned sour on Tuesday as Nvidia’s $5.5 billion charge over halted China chip sales sent shockwaves across both equities and crypto. With Bitcoin, XRP, and ADA all slipping, market jitters signal growing concerns over the broader economic impact of renewed U.S.-China trade tensions.

Bitcoin Falls Below $84K Amid Broader Market Dip

Bitcoin, which had earlier touched a two-week high of $86,440, slid to $83,600 by late Tuesday, mirroring the drop in equity markets. The fall coincided with Nvidia’s after-hours stock plunge, down 8% to $89.10, following news of a massive write-down tied to Trump-era restrictions on chip exports to China.

Altcoins also felt the heat:

• XRP dropped over 2% to $2.08
• Cardano’s ADA slipped 4% to $0.61
• The CoinDesk 20 Index lost over 2%, reflecting broad-based weakness.

AI-Linked Tokens Also Struggle as Nvidia Sinks

Tokens loosely tied to AI narratives were hit hardest, suffering alongside Nvidia’s stock. The chipmaker’s woes stem from the U.S. government’s decision to ban the sale of its H20 chips to China, escalating trade tensions and dampening sentiment around AI-driven sectors.

This came on the back of unusual options activity in NVDA, which had hinted at an impending market drop. With the Nasdaq futures sliding over 1%, risk assets, including crypto, followed suit in a show of correlation rarely seen in more optimistic market climates.

Eyes on U.S. Retail Data and Fed’s Powell

Markets now await the U.S. retail sales report for March, due Wednesday morning. Analysts expect a 1.2% rise, up from February’s 0.2% increase. A strong report could ease recession fears, but many traders are bracing for disappointment, seeing the data as backward-looking and unlikely to counteract recent geopolitical tensions.

More crucially, Federal Reserve Chair Jerome Powell is set to speak at the Economic Club of Chicago. His comments are expected to influence rate cut expectations, especially as inflation breakevens drop, pointing to a disinflationary effect from Trump’s sweeping tariffs.

Trade War and Rate Cut Rumblings Fuel Uncertainty

Trump’s latest trade moves—announcing sweeping tariffs on April 2, then pausing them for most countries except China—have left investors uneasy. According to Fed Governor Christopher Waller, these actions could push the central bank to issue rapid “bad news” rate cuts.

As geopolitical tensions rise and recession talks gain traction, both traditional and crypto markets may remain volatile. The Fed’s next move and global trade developments will likely dictate the tone in the coming weeks—especially for risk-on assets like Bitcoin and altcoins.