The largest détente in history! The China-U.S. trade agreement has been reached: Trump reduces tariffs, and the rare earth ban is suspended.

President Trump announced a protocol to suspend additional tariffs, cancel non-tariff measures, and increase soybean purchases. U.S. President Trump facilitated a far-reaching U.S.-China trade protocol, which is a breakthrough for global markets. The protocol includes China's commitment to suspend new export controls on rare earths and critical minerals, stop the shipment of fentanyl precursors to the U.S., and cancel retaliatory tariffs and non-tariff measures effective from March 4, 2025.

Analysis of the Five Core Contents of the China-U.S. Trade Protocol

(Source: White House)

The protocol reached with the Chinese leader has eased the tensions between the world's two largest economies. According to the official briefing from the White House, the protocol includes China's commitment to suspend new export controls on rare earths and critical minerals. Additionally, both sides will stop sending fentanyl precursors to the United States and eliminate all retaliatory tariffs and non-tariff measures that would take effect from March 4, 2025.

The suspension of export controls on rare earths and critical minerals has significant implications for the global technology supply chain. Rare earths are key materials used in the manufacturing of semiconductors, electric vehicle batteries, wind turbines, and military equipment, and China controls about 70% of global rare earth production and 90% of processing capacity. Previously, China threatened to restrict rare earth exports, causing panic in the global technology industry. The suspension of this protocol provides U.S. technology companies with a one-year buffer period to seek alternative supply chains or increase strategic reserves.

The control of fentanyl precursors is an important issue in American domestic politics. Fentanyl abuse leads to tens of thousands of deaths in the United States each year, and the Trump administration used the crackdown on fentanyl influx as an important bargaining chip to pressure China. China promised to stop supplying fentanyl precursors to the United States, providing Trump with a significant political victory that helped him showcase the results of his tough stance on China to domestic voters.

The Five Core Contents of the China-U.S. Trade Agreement

Temporary Suspension of Rare Earth Controls: China promises to suspend new export controls on rare earths and key minerals.

Fentanyl Control: Stop transporting fentanyl precursors to the United States.

Tariff Reduction: The United States will reduce tariffs on imported goods from China by 10%, effective from November 10.

Cancellation of Retaliatory Measures: Both parties cancel all retaliatory tariffs and non-tariff measures implemented since March 4.

Soybean Procurement Commitment: China will purchase at least 12 million tons of American soybeans by the end of the year, and 25 million tons annually before 2028.

According to the protocol, starting from November 10, 2025, the United States will reduce the Trump tariffs on Chinese imports by 10% and extend the exemption period for key Section 301 tariffs. In addition, the United States will also suspend trade response measures related to ongoing maritime and logistics investigations for a year. The China-U.S. trade agreement also guarantees that China will purchase at least 12 million tons of American soybeans by the end of the year. Furthermore, by 2028, China will purchase at least 25 million tons of American soybeans each year.

Trump Tariff Exemptions Reshape Global Supply Chain

The leading market communication “Kobesi Communication” emphasizes the importance of this: “This is the largest de-escalation action to date… but it has not received enough attention.” This comment reveals an interesting phenomenon: despite the significance of the protocol content, the market reaction has been relatively muted. This may be due to investors feeling fatigued with the China-U.S. trade negotiations, or having doubts about the durability of the protocol.

This milestone protocol effectively reshaped trade relations, breaking the vicious cycle of previously implemented retaliatory measures that had pressured corporate profits and sowed seeds of uncertainty in the supply chains of key industries. The direct beneficiaries of the US-China trade agreement include American agriculture, semiconductor manufacturing, and the production of critical minerals needed for electric vehicles and consumer electronics.

The 10% reduction in Trump tariffs may seem mild, but it is significant for the affected industries. For example, a 10% tariff reduction on electronic products could mean a shift in corporate profit margins from negative to positive, or a noticeable drop in consumer prices. For American companies relying on the Chinese supply chain, this cost reduction will directly translate into enhanced competitiveness.

More importantly, the signaling effect released by the protocol. The U.S.-China trade tensions have been escalating since 2018, forcing companies to make painful supply chain adjustments, moving production lines from China to places like Vietnam and India. These adjustments are costly and take years. The conclusion of this protocol, although it does not mean a complete return to the state before 2018, at least suspends further escalation and provides stability for companies to plan.

The crypto market welcomes a much-needed rise in risk appetite

Financial analysts believe that risk assets such as stocks, technology stocks, and digital assets may benefit from a stabilization in the market. In recent months, the cryptocurrency market has lagged behind market risk appetite, but as regulatory and trade uncertainties dissipate, institutional capital inflows may increase. The improvement in US-China trade relations could facilitate the cross-border operations of cryptocurrency companies listed in the US and reduce market volatility influenced by news events.

The removal of tariff barriers and restrictions on technology exports is good news for institutional investment portfolios, as cryptocurrencies are increasingly becoming a pillar of that portfolio. If confidence spreads to all asset classes, Bitcoin, Ethereum, and tokenized goods reliant on global supply chains are expected to see new growth momentum. The logic chain is: trade easing → increased risk appetite → increased allocation of institutional funds → benefits for the crypto market.

Cryptocurrency investors may soon face the worst bull cycle in history, possibly welcoming a much-needed second wave. The crypto bull market of 2024-2025 shows a clear characteristic of “institutional dominance, retail absence”; while Bitcoin reaches new highs, altcoins generally perform weakly. This divergence has led many investors to question the authenticity of the bull market. The achievement of a China-U.S. trade agreement may serve as a catalyst to transmit institutional optimism to the broader crypto market.

Historically, the cryptocurrency market has shown a lagged response to macro risk events. During the early stages of the China-U.S. trade war in 2018, Bitcoin briefly benefited from safe-haven demand, but as recession expectations intensified, it ultimately followed the stock market down. If the recent China-U.S. trade agreement can continue to improve global economic expectations, its positive impact on the cryptocurrency market may gradually manifest in the coming weeks to months.

Analysis of Benefits in Agriculture, Technology, and Cryptocurrency

The direct beneficiaries of the US-China trade agreement are clear. The US agricultural sector is the first to benefit, as China has committed to purchasing at least 12 million tons of US soybeans by the end of the year, and at least 25 million tons annually by 2028. This large-scale procurement commitment provides US farmers with stable market expectations, contributing to the stabilization of agricultural product prices and an increase in agricultural investment.

The semiconductor manufacturing industry is another important beneficiary. The suspension of rare earth export controls ensures that American chip manufacturers can obtain critical raw materials. The production costs and supply chain risks for companies like NVIDIA, AMD, and Intel will be reduced. This is a key piece of good news for the semiconductor industry, which is currently experiencing an explosion in demand for AI chips.

The electric vehicle and consumer electronics industries benefit equally. Key minerals such as lithium, cobalt, and nickel are core materials for electric vehicle batteries, and China dominates the processing segment of these minerals. The suspension of export controls provides double assurance in terms of cost and supply for electric vehicle manufacturers like Tesla.

For the cryptocurrency market, the impact is more indirect but equally important. First, the improvement in the global trade environment has enhanced overall risk appetite, making institutional investors more willing to allocate to high-volatility assets. Second, the multinational operations of U.S.-listed cryptocurrency companies (such as Coinbase, Riot Platforms, etc.) will become smoother. Third, the reduction in supply chain costs may drive more companies to adopt blockchain technology to optimize logistics and settlement efficiency.

As the current ceasefire protocol is gradually implemented, the focus of all parties will shift to how the two governments fulfill and maintain these commitments. At the same time, given the warming signals of risk appetite and the improvement in the global trade environment, the recent sluggish state of the cryptocurrency industry may迎來轉機. Currently, market and policy observers will closely monitor subsequent developments, including practical operational aspects and chart trends.

protocol durability is in doubt, the market remains cautiously optimistic

It is worth noting that despite the significant content of the China-U.S. trade protocol, the market reaction has been relatively cautious. This caution stems from doubts about the durability of the agreement. Historically, there have been multiple cycles of “reaching an agreement → breaking down → renegotiating” in China-U.S. trade negotiations. The “Phase One Agreement” in 2019 also promised large-scale purchases of U.S. agricultural products by China, but the final implementation did not meet expectations.

In addition, some parts of the protocol have a time limit. The export control of rare earths is suspended for one year, and the maritime investigation measures are suspended for one year. The use of the term “suspended” rather than “canceled” suggests that both sides have left room to restart hostilities in the future. If negotiations fall into a deadlock again after one year, the current easing may quickly reverse.

For cryptocurrency investors, this protocol should be seen as a short-term positive but with long-term vigilance. The improvement of the trade environment does help the performance of risk assets, but the fundamental drivers of the crypto market still lie in regulatory clarity, technological innovation, and practical application implementation. The China-US trade agreement only improves the macro environment and does not address the structural issues within the crypto market.