Source: Cointelegraph.com NewsUS President Donald Trump introduced a slew of tariffs on April 2, sending markets into a tailspin and dividing crypto observers as to their possible long-term effects.\u00a0
\nAt a special event at the White House, Trump signed an executive order and claimed emergency powers, leveling reciprocal tariffs at every country that has a tariff on US goods, starting at a 10% minimum.
\nThe long-term effect that this swathe of new taxes could have on global markets is unknown. The uncertainty is compounded by the ambiguous methodology the Trump administration used to determine the tariff rates.\u00a0
\nSome believe that the crypto market is due for a boom as investors seek an alternative for traditional investments. Others note the effect tariffs could have on mining equipment, hampering profitability. More still are concerned about the broader impact of tariffs and a possible recession.\u00a0<\/p>\n
Trump\u2019s tariffs \u201cprovide certainty\u201d for markets Source: Cointelegraph.com NewsUS President Donald Trump introduced a slew of tariffs on April 2, sending markets into a tailspin and dividing crypto observers as to their possible long-term effects.\u00a0 At… <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5],"tags":[],"_links":{"self":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/126391"}],"collection":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=126391"}],"version-history":[{"count":0,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/126391\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=126391"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=126391"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=126391"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nFinancial markets crashed immediately on the news of the tariffs, with crypto markets no exception.\u00a0
\nBitcoin (BTC) had nearly reached a session high at $88,500 but dropped 2.6% back to around $83,000. Ether (ETH) fell from $1,934 to $1,797 immediately following the tariff announcement, and the total crypto market capitalization dropped 5.3% to $2.7 trillion.\u00a0
\nCrypto shows red across the board after Trump\u2019s tariff order. Source: Coin360Some market analysts aren\u2019t shaken. Trader Micha\u00ebl van de Poppe wrote that the tariffs \u201cwon\u2019t be as bad as the entire population expects them to be.\u201d
\n\u201cUncertainty fades away. Gold will drop. \u2018Buy the rumor, sell the news,\u2019\u201d he said. \u201cAltcoins & Bitcoin goes up. \u2018Sell the rumor, buy the news.\u2019\u201d
\nBitMEX founder Arthur Hayes said that while the tariffs may reduce the trade deficit, fewer exports could limit the demand for US Treasurys, requiring domestic intervention from the Federal Reserve to stabilize the market.
\n\u201cThe Fed and banking system must step up to ensure a well-functioning treasury [market], which means Brrrr,\u201d he said.
\n\u201cBrrrr\u201d \u2014 a reference to the Reserve printing more money \u2014 is a theory Hayes has previously suggested could be positive for Bitcoin\u2019s price as increased liquidity enters the market.
\nWhat about crypto miners?
\nAmerican crypto miners may have less cause for optimism about the tariffs, as they are directly affected by the markups on goods \u2014 namely crypto mining rigs \u2014 imported from Asia.
\nMitchell Askew, head analyst at mining-as-a-service firm Blockware Solutions, said: \u201cTariffs have MASSIVE implications for Bitcoin Miners. [Expect] off-shore supply to get squeezed, increasing demand for on-shore miners. If this is coupled with a BTC run we could see ASIC [mining rig] prices rip 5 to 10x like they did in 2021.\u201d
\nMason Jappa, CEO of Blockware, said that the tariffs will have \u201ca major impact\u201d on the Bitcoin mining industry. \u201cMost of the current Bitcoin Mining Server imports were coming from Malaysia\/Thailand\/Indonesia. Rigs already landed in the USA will become more valuable,\u201d he wrote.
\nRelated: Crypto miner backs US senator’s efforts to incentivize using flared gas
\nSome mining companies are already rushing to get mining rigs out of the export country before the tariffs take effect. Lauren Lin, head of hardware at Bitcoin mining software firm Luxor Technology, told Bloomberg on April 3 that her firm was \u201cscrambling.\u201d
\n\u201cIdeally, we can charter a flight and get machines over \u2014 just trying to be as creative as possible to get these machines out,\u201d she said.
\nTariffs\u2019 doubtful math, \u201cextraordinary nonsense,\u201d and a looming recession\u00a0
\nThe convenient tariff percentage charts displayed at the signing event at the White House left many questioning exactly how the Trump administration came up with the numbers and why certain countries were chosen.\u00a0
\nYale Review editor James Surowiecki wrote that the administration didn\u2019t actually calculate tariff rates plus non-tariff barriers to determine their rates, but rather \u201cjust took our trade deficit with that country and divided it by the country’s exports to us.\u201d\u00a0
\n\u201cWhat extraordinary nonsense this is.\u201d
\nSome have even floated the theory that the administration used ChatGPT to come up with the countries and numbers. NFT collector DCinvestor said that he was able to nearly exactly duplicate the list through prompts on the generative AI.\u00a0
\n\u201cI was able to duplicate it in ChatGPT. it also told me that this idea hadn’t been formalized anywhere before, and that it was something it came up with. ffs Trump admin is using ChatGPT to determine trade policy,\u201d he said.\u00a0
\nAlso of note: some of the smaller countries and territories on the White House\u2019s list. The full list, as reported by Forbes, levies a 10% tariff on the Heard and McDonald Islands in response to their 10% duties on the United States.
\nThe Heard and McDonald Islands are uninhabited, barren and some of the most remote places on earth, located 1,600 km from Antarctica. No one lives there; no trade exists.\u00a0\u00a0\u00a0
\nHeard Island, a snow-covered rock. Source: WikipediaThe dubious maths and contents of the tariff list have many doubting the administration\u2019s economic calculus.\u00a0
\nNigel Green, CEO of global financial advisory giant deVere Group, told Cointelegraph that the president \u201cpeddles in economic delusion.\u201d
\n\u201cIt\u2019s a seismic day for global trade. Trump is blowing up the post-war system that made the US and the world more prosperous, and he\u2019s doing it with reckless confidence,\u201d he said.
\nRelated: Lawmaker alleges Trump wants to replace US dollar with his stablecoin
\nAdam Cochrane, a partner at Cinneamhain Ventures, said that tariffs \u201cwork great for most of those things\u201d when they target industries that also have present-day production to offset the increased cost of imported goods.\u00a0
\n\u201cThe US doesn\u2019t have that, nor the factories for it, not the labor to offset it, nor the raw materials for it. So you end up just paying more for the same good.\u201d
\nAt the end of March, Goldman Sachs had already tipped the chance of a recession in the US at 35%. After Trump signed the order, betting markets on Kalshi increased that to over 50%.
\nBetting markets aren\u2019t betting on the American economy. Source: KalshiTrump, for his part, contended that the tariffs will \u201cmake America great again\u201d and give the US economy a competitive edge with its former allies and trade partners. He argued in his signing speech that the Great Depression of the 1930s would have never happened if tariffs had been maintained.
\nThe Smoot-Hawley Tariff Act, which raised tariffs during the Depression, is widely credited as being a contributing factor to worsening the Depression and has become synonymous with disastrous economic policymaking.\u00a0
\nMagazine: Financial nihilism in crypto is over \u2014 It\u2019s time to dream big againRead More<\/a><\/p>","protected":false},"excerpt":{"rendered":"