#TrumpTariffs The cryptocurrency market has been notably responsive to former President Trumpâs tariff strategy in recent months:
đ Market Reactions & Sentiment
**Volatility spikes with tariff announcements:**
In early April, when Trump threatened 50% tariffs on Chinese and EU goods, Bitcoin dropped nearly 4%, losing over $100 billion in market cap. Ether and other altcoins also fell ~4% .
**Relief rallies following tariff pauses or deals:**
The 90-day tariff pause in May triggered recoveries: Bitcoin surged past $105K to ~$109K, and Ether saw ~3% gains .
**Optimism tied to U.S.âChina trade truce:**
Recent reports of a tentative deal (U.S. 55% / China 10%) have lifted cryptocurrencies. Bitcoin climbed near $110K after announcements .
đ Why Crypto Is So Sensitive
1. Risk-on proxy: When global trade tensions heat up, investor risk appetite wanes, and assets like crypto often take the first hit .
2. Inflation hedge narrative: Tariffs can fuel inflation and weaken the dollar; some, including Binance and Bitwise analysts, argue this positions Bitcoin as a non-sovereign store of value .
3. Fed policy linkages: Ongoing tariff uncertainty affects the Federal Reserveâs decisions. With inflation blended and growth slowed, markets may delay rate cuts, impacting crypto sentiment .
đź Takeaway
Crypto reacts swiftly to U.S. tariff newsâtariff threats spark sell-offs, while pauses or truce signals boost prices.
Trumpâs latest 55%/10% U.S.âChina deal corresponded with a rebound in Bitcoin close to all-time highs.
Looking ahead, continued tariff uncertainty or legal developments (like the July appeal) could keep crypto markets jittery, with each headline potentially triggering sharp movesâeither upward or downward.
