Trump’s Protectionist Policies Can Lead To Tariff War & Crypto Crash. Read How.

Monday has been nightmarish for investors. The United States Of America announced a fresh tariff, and this has led people to believe that a financial crash is currently afoot. Also, this new tariff by the US and its allies is believed to escalate wars. 

President Trump is all set to make good on his promise of protectionist trade policies with a 25% tariff on Canada and Mexico. Subsequently, enforcing around 10% on China. This new tariff is all set to go on the floor by Tuesday. 

Political and financial experts believe this could start another trade war with its three biggest competitors and contributors: Canada, Mexico, and China. As a result, Mexico and Canada have imposed retaliatory tariffs on the United States of America.

New Rule/New Tariffs

The new tariff imposed by the current US President, Donald Trump, has shaken the trade community to its core by rapidly increasing tariffs on three of the biggest trading platforms of the USA. The aggressive hike in the name of protectionist trade policies has sent shockwaves.

This move can potentially lead to one of the biggest macroeconomic risks of 2025. As a result, investors are observing what happens next with bated breath. A former researcher from Binance China, known only as Jinze, has stated that this has led America on a lose-lose path.

Many people, including Jinze, believed this was merely a negotiation ploy. However, Trump surprised everyone and made this shift happen.

The 30% Hike 

The news of newer tariffs was broken on Saturday. As soon as the news was broken, there was a certain shift in the whole landscape. Suddenly, the story of the rising crypto market came to a screeching halt.

The fall in BTC price is an indicator of this downward shift. BTC rapidly fell from its all-time high of $100,000 bracket to around $94,000 bracket. This significant and sharp decline is enough to make everyone uneasy. 

The Long-drawn Effects 

Trump had a very pro-crypto outlook before the election. As a result, many investors were optimistic that this would lead to a major crypto surge under Trump’s rule. However, the recent news of a 25% tariff on Mexico/Canada and 10% on China has changed the landscape.

The managing director of IMF, Kristina Georgieva, stated in the press that this decision could lead to a major scale economic disruption. Moreover, many investors openly stated their disappointment with the decision.

Meanwhile, Jeff Parks of Bitwise Asset Management believes this is good for Bitcoin. Parks stated that “A sustained tariff war will be amazing for bitcoin in the long run due to an eventual weakening of the dollar and U.S. rates.” 

Endnote: Can This Hike Lead To Crash?

Currently, the future of BTC and other crypto investors looks bleak due to Trump’s protectionist trade policies. However, seasoned crypto traders believe that things are still under control. Since they have seen BTC recover 30%. Therefore, the only way out is to ride the waves and see what the future holds.