Trump’s upcoming tariffs could impact crypto markets by influencing investor risk sentiment.
Bitcoin and Ethereum may face volatility depending on the scope of trade measures.
With less than a week to go before April 2, US President Donald Trump is preparing to impose a new round of reciprocal tariffs, calling the date “Liberation Day” for the US economy.
The move is expected to reshape US trade policy, affecting key international partners and industries. Trump has made no secret of his opinions on trade, stating that tariffs are needed to address what he calls unfair trading practices by other nations.
Reports say the administration is considering a selective approach, targeting the so-called “dirty 15” countries with the worst trade balances with the US.
These measures have the potential to have broader economic ramifications, impacting sectors like steel, aluminum, and automobiles. Trump has also indicated that he will apply secondary tariffs to Venezuela, stating that any country that purchases oil or gas from the South American nation will be hit with a 25% tariff when trading with the US.
While some sectors may be spared from across-the-board tariffs, others remain at risk. The European Union has already announced that it will slap counter-tariffs on $28 billion worth of US goods beginning in April.
However, others, such as the 50% tariff on US whiskey, were postponed until mid-April, which at one time earlier in the past led to Trump’s threats of a 200% tariff on EU spirits.
Meanwhile, China has responded in kind with its own tariffs, imposing up to 15% tariffs on US farm products like pork and chicken.
Aggressive Tariffs Could Pressure Crypto Demand
For the crypto market, the uncertainty of Trump’s tariff policy has become a key driver of investor sentiment. Bitcoin and Ethereum have exhibited volatility in recent weeks, reacting to shifts in risk appetite due to economic policies.
If the administration slaps aggressive tariffs on a number of nations, financial markets could be volatile, prompting investors to flee to safe-haven assets like the US dollar. This could result in less demand for cryptocurrencies on a short-term basis.
Recent history also demonstrates Bitcoin performing poorly in risk-off situations. In February, tough talk on trade from Trump assisted in prompting a sell-off in markets, with Bitcoin dipping below key support levels.
Source: Tradingview
If similar pressure were to build early in April, digital assets may experience another leg of selling pressure. Traders will be monitoring developments closely to determine the potential impact on liquidity and sentiment generally.
However, if Trump assumes a more sensible position, with targeted tariffs rather than blanket policies, market stability can be promoted. A well-defined policy framework can remove uncertainty so that crypto prices can recover.
Earlier this March, even modest indications of flexibility had Bitcoin recovering from local lows. The saTrump’s upcoming tariffs could impact crypto markets by influencing investor risk sentiment.
Bitcoin and Ethereum may face volatility depending on the scope of trade measures.
With less than a week to go before April 2, US President Donald Trump is preparing to impose a new round of reciprocal tariffs, calling the date “Liberation Day” for the US economy.
The move is expected to reshape US trade policy, affecting key international partners and industries. Trump has made no secret of his opinions on trade, stating that tariffs are needed to address what he calls unfair trading practices by other nations.
Reports say the administration is considering a selective approach, targeting the so-called “dirty 15” countries with the worst trade balances with the US.
These measures have the potential to have broader economic ramifications, impacting sectors like steel, aluminum, and automobiles. Trump has also indicated that he will apply secondary tariffs to Venezuela, stating that any country that purchases oil or gas from the South American nation will be hit with a 25% tariff when trading with the US.
While some sectors may be spared from across-the-board tariffs, others remain at risk. The European Union has already announced that it will slap counter-tariffs on $28 billion worth of US goods beginning in April.
However, others, such as the 50% tariff on US whiskey, were postponed until mid-April, which at one time earlier in the past led to Trump’s threats of a 200% tariff on EU spirits.
Meanwhile, China has responded in kind with its own tariffs, imposing up to 15% tariffs on US farm products like pork and chicken.
Aggressive Tariffs Could Pressure Crypto Demand
For the crypto market, the uncertainty of Trump’s tariff policy has become a key driver of investor sentiment. Bitcoin and Ethereum have exhibited volatility in recent weeks, reacting to shifts in risk appetite due to economic policies.
If the administration slaps aggressive tariffs on a number of nations, financial markets could be volatile, prompting investors to flee to safe-haven assets like the US dollar. This could result in less demand for cryptocurrencies on a short-term basis.
Recent history also demonstrates Bitcoin performing poorly in risk-off situations. In February, tough talk on trade from Trump assisted in prompting a sell-off in markets, with Bitcoin dipping below key support levels.
Source: Tradingview
If similar pressure were to build early in April, digital assets may experience another leg of selling pressure. Traders will be monitoring developments closely to determine the potential impact on liquidity and sentiment generally.
However, if Trump assumes a more sensible position, with targeted tariffs rather than blanket policies, market stability can be promoted. A well-defined policy framework can remove uncertainty so that crypto prices can recover.
Earlier this March, even modest indications of flexibility had Bitcoin recovering from local lows. The sa
