Trump's tax cut proposal, if implemented, will profoundly impact the cryptocurrency market and economic landscape:
Short-term bullish on cryptocurrencies:
Elimination of income tax may stimulate capital inflows into anti-inflation assets, with Bitcoin potentially being the biggest beneficiary.
Expectations of dollar depreciation will drive demand for hard assets like BTC, recreating the macro environment of 2020.
Structural economic risks:
Tariffs replacing income tax could trigger Trade War 2.0, exacerbating supply chain inflation.
Monetization of fiscal deficits may force the Federal Reserve to maintain high interest rates, creating a "stagflation" dilemma.
Cryptocurrency market differentiation:
Bitcoin's status as "digital gold" is strengthened.
Usage of stablecoins may surge, becoming a new medium for cross-border trade.
High beta altcoins may be impacted by liquidity tightening.
Recommendation: Bullish on BTC in the medium term, but remain cautious of volatility brought about by policy fluctuations. This proposal essentially shifts the tax burden from labor to capital, potentially accelerating the restructuring of the dollar system, with cryptocurrencies becoming an important hedging tool.
