The trade policies of U.S. President Donald Trump, particularly the tariffs he imposed on countries like Canada, Mexico, and China, have become a significant economic point of contention. This has also affected the cryptocurrency market.
Trade War: A New Reality
Trump's recent tariff war began with the announcement of a 25% tariff on goods imported from Canada and Mexico, alongside a 10% duty on Chinese imports. Since then, Canada and Mexico have announced retaliatory tariffs on the U.S. With approximately $1.6 trillion in U.S. trade involved, the implications are significant, and new tariffs on the European Union might escalate tensions further.
Impact on Cryptocurrency Market
Cryptocurrency markets have historically been sensitive to global economic events. The announcement of Trump's tariffs saw an immediate dip in the prices of major cryptocurrencies like Bitcoin and Ethereum. Bitcoin experienced a significant drop from its peak of $107,000 in January 2025 to around $91,000. Caroline Bowler, CEO of BTC Markets, pointed out that "Trump's tariff war is impacting the whole market."
Long-Term Prospects for Investors
The broader cryptocurrency market, including altcoins and meme coins, has suffered significant losses. Meme coins like Dogecoin have been particularly affected. Despite short-term negative reactions, some investors see potential long-term benefits. Jeff Park from Bitwise Asset Management argued that a sustained tariff war could eventually benefit Bitcoin by weakening the U.S. dollar.
The impact of trade policy on the global economy and cryptocurrencies continues to grow. Investors should consider both short-term risks and potential long-term benefits.
