Last month, following Trump’s order to establish a Strategic Bitcoin $93,348 Reserve, a notable decline of approximately 13% was observed in the value of Bitcoin assets. This decrease is fundamentally linked to escalating trade wars and the effects of newly implemented tariff policies.
Tariff Policy
Over the weekend, Trump enacted a basic 10% tariff on imports into the U.S., subsequently threatening an additional 50% tariff on China. Today, he has activated the extra tax, raising the rate to 104%. Such measures naturally impact all markets, and cryptocurrencies are not exempt from this influence. The U.S. Bitcoin reserve is likewise affected, as its value in dollars is rapidly diminishing due to tariffs.
As the Strategic Bitcoin Reserve is being established, federal agencies have been ordered to report the amount of Bitcoin and other digital assets. It was noted that there is no requirement for these assets to be disclosed publicly.
Reactions from the Crypto Market
Following the tariff announcements, prices in the cryptocurrency markets also fell. The total cryptocurrency market capitalization has decreased by approximately 15% since the last announcement. While some believe that cryptocurrencies can operate somewhat independently of traditional markets, this notion proved short-lived.
The value of the U.S. government’s crypto asset portfolio stands at about $15.9 billion, with around $15.6 billion represented by Bitcoin. Most of these assets were obtained through previous seizures of cryptocurrencies.
The impact of the tariffs is not limited to crypto assets; it has also influenced global stock markets. For example, the S&P 500 index experienced a 20% drop, indicating the widespread market effects of the tariffs.
Assets belonging to the World Liberty Financial project, associated with the Trump family, have also been hit during this process. The value of cryptocurrencies tied to this project has decreased by approximately 49% compared to the time of acquisition.
These developments highlight the interconnected dynamics of economic fluctuations, trade wars, and tariff policies on both digital assets and traditional markets. Such changes prompt investors to develop alternative strategies against market risks and provide significant insights for future economic activity.