Trump's Tariffs and Their Impact on Bitcoin Prices and the Crypto Market
At the beginning of 2025, the world was once again shaken by protectionist policies brought by Donald Trump during his new term. By implementing new tariffs against various trading partner countries, Trump indirectly reignited global tensions, affecting the stock market, and of course… the crypto market.
Bitcoin prices have declined since the announcement of the tariff policy. To understand why this is happening, it is important to further examine: what are trade tariffs, what is their relation to trade wars, and why can such policies shake the crypto market?
What Are Trade Tariffs
Trade tariffs are a form of tax imposed by a country on goods imported from abroad. The objectives can vary: protecting domestic industries from foreign competition, reducing trade deficits, to stimulating local production.
In the context of Trump's policies, these tariffs are used as an economic weapon to pressure other countries to open greater market access for US products, as well as to encourage domestic investment and job creation. However, this policy is not without risks.
High tariffs can cause:
Increase in consumer goods prices (due to higher import costs),
Disruption of global supply chains,
And most dangerously: retaliatory response from other countries, which triggers trade wars.
Global trade wars have severe consequences that can slow economic growth, increase inflation, and reduce people's purchasing power. When the world economy enters a state of uncertainty, all sectors are affected, including crypto.
Crypto Market Pressured Amid Global Uncertainty
Since the trade tariffs were announced again by Trump in early 2025, the global crypto market has shown a downward trend. Bitcoin prices, which had previously been stable in the range of 90-100k, began to correct due to rising concerns about the long-term impact of the policy.
Many institutional investors are starting to move their funds from risky assets like crypto to instruments considered more stable like gold and government bonds. This indicates that crypto, despite being on the rise as a new asset class, is not yet fully regarded as a safe haven during crises.
The reasons are quite clear due to high price volatility, lack of clear regulation in many countries, and the perception that crypto is still closer to speculation than long-term investment.
It is not surprising that, until now, Bitcoin prices still show no signs of significant recovery. Nevertheless, many parties still see Bitcoin's long-term potential amid the trend of de-dollarization and rising distrust of traditional monetary authorities.
Why Can Global Politics Affect Crypto Prices?
The Crypto Market is not just about blockchain technology or decentralized systems. Its value is also greatly influenced by global market sentiment, including geopolitical dynamics and macroeconomic policies.
Several examples show how closely related this is:
When Russia invaded Ukraine, the volume of crypto transactions surged dramatically. Crypto was used as an alternative channel to transfer wealth across borders amid economic sanctions.
When inflation in the US surged and The Fed raised interest rates, investors rushed to withdraw funds from crypto, triggering a significant price drop.
Now, with Trump's tariff policies that are aggressive, concerns arise that a new trade war will slow down the world economy, increase inflation, and trigger a recession.
In this context, investors begin to ask: Can Bitcoin be a safe haven like gold? Can it withstand the turmoil of the global economy triggered by politics?
The answers to these questions will greatly determine the direction of the crypto market in the coming months.
Bitcoin as a Safe Haven Asset
Bitcoin is often referred to as “digital gold,” because it has several characteristics similar to gold:
Its quantity is limited (a maximum of only 21 million coins),
Not dependent on any central authority,
Hard to counterfeit, and can be stored digitally without intermediaries.
However, unlike gold which has been used for thousands of years as a safe haven, Bitcoin is still relatively young and does not have a long track record in facing global economic crises.
Bitcoin's price volatility has also become a major obstacle to its adoption as a safe haven. Extreme price fluctuations make some investors prefer conventional assets during times of increased uncertainty.
However, its long-term potential cannot be ignored. If confidence in fiat currencies like the US dollar continues to weaken due to economically unstable policies, Bitcoin could become an increasingly attractive alternative for global investors.
Is This the Right Time to Enter the Crypto Market?
As news of Trump's tariff policies continues to dominate the media, both novice and experienced investors are starting to question: “Given the geopolitical conditions, is now the right time to buy crypto?”
The answer is not as simple as “yes” or “no”.
Historically, times of uncertainty have often been momentum for accumulation for long-term investors. When prices drop, many investors see an opportunity to enter before the market recovers. However, the current conditions are quite unique. Bitcoin prices are under pressure, volatility is high, and market sentiment is still fragile due to trade tensions and inflationary pressures.
So what can be done?
Understand the risks: Crypto is highly volatile, especially amid global uncertainty. Don't go all-in without a strategy.
Use a dollar-cost averaging (DCA) approach: This strategy can help reduce the impact of volatility by gradually buying in fixed amounts.
Diversify: Don't just focus on one asset, consider balancing your portfolio with more stable assets.
Conclusion
Global tensions due to Trump's trade tariffs have driven a shift in market sentiment that has also pressured the prices of Bitcoin and other crypto assets. Amid fluctuations and uncertainty, crypto has not yet been fully recognized as a safe haven, although its potential remains open. In this situation, caution, asset diversification, and monitoring geopolitical developments are key for investors who want to stay in the crypto market.
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Risk Disclaimer: Cryptocurrency prices are subject to high market risk and price volatility. You should only invest in products that you are familiar with and where you understand the associated risks. You should carefully consider your investment experience, financial situation, investment objectives and risk tolerance and consult an independent financial adviser prior to making any investment. This material should not be construed as financial advice. Past performance is not a reliable indicator of future performance. The value of your investment can go down as well as up, and you may not get back the amount you invested. You are solely responsible for your investment decisions.
