#TrumpTariffs Impact of Trump's Tariffs on the Crypto Economy 💰
Cryptocurrency markets reacted quickly: on August 1, 2025, Bitcoin fell below $115,200 and other cryptocurrencies like Ethereum, Solana, and Dogecoin lost up to 8%, resulting in nearly $1 billion in forced liquidations on leveraged positions. The sharp deterioration in risk sentiment caused investors to flee to safe-haven assets like U.S. Treasury bonds.
These declines reflect the high correlation between cryptocurrencies and risk assets: while Bitcoin dropped 3-6% in a matter of hours, altcoins linked to the tech sector suffered more severe losses of nearly 9%. Analysts at CoinShares pointed out that, although tariffs could elevate inflation and curb medium-term growth, this could strengthen Bitcoin as a safe-haven asset in the long term if a stagflation scenario emerges.
Additionally, tariffs on imported hardware for mining, especially from China, have increased operating costs and led manufacturers like Bitmain, Canaan, and MicroBT to establish plants in the U.S. to circumvent them. Although these measures favor some domestic producers in the mining industry like Auradine, the overall outlook implies higher barriers to entry and potential restructuring of the global supply chain.
