Crypto Rallies After Trump’s $2K Tariff Dividend Plan Jolts Markets

The crypto market had a sharp rebound on Sunday after US President Donald Trump jumped onto Truth Social and floated...

Quick overview

  • The crypto market experienced a significant rebound after Donald Trump proposed a $2,000 cash payment to Americans funded by tariff revenue.
  • Trump's proposal led to a surge in cryptocurrency prices, with Bitcoin surpassing $106,000 and Ethereum exceeding $3,600.
  • Investors are drawing parallels to the 2020-2021 stimulus checks, which previously boosted the crypto market significantly.
  • Despite the excitement, Trump's proposal remains uncertain as it would require Congressional approval to become a reality.

The crypto market had a sharp rebound on Sunday after US President Donald Trump jumped onto Truth Social and floated a pretty wild idea – sending Americans a $2,000 cash payment funded by tariff revenue. Trump claimed the US is raking in ‘trillions of dollars’ in tariffs and wants to use some of that to help pay off the national debt and give even more to ordinary Joe, with the caveat that high-income earners are out of luck.

This comes at a pretty interesting time for Trump’s tariff policies – they’re currently under the microscope of the US Supreme Court, which is trying to decide whether his earlier tariff decisions were within his power. But in his Truth Social post, Trump basically defended his tariff policies as a major reason the country is raking in so much tax revenue and achieving such a strong economic performance.

Crypto Prices Take Flight On Renewed Stimulus Hopes

Trump’s proposal got a pretty instant reaction on the markets – check this out:

  • Bitcoin zoomed up above $106,000
  • Ethereum leapt past $3,600
  • Solana went well past $165

The Stimulus Train Keeps on Rolling

Investors quickly drew comparisons to those 2020-2021 stimulus checks—they really got the economy rolling and even got some cash flowing into crypto.

At the time:

  • Bitcoin went from rock bottom to over 20 times the price it had been in a flash
  • Ethereum surged nearly 50 times over its lows
  • Smaller altcoins basically just exploded in value

Crypto analyst Money Ape basically called Trump’s tariff dividend a ‘modern stimulus check’, saying even partial or delayed payments could get the market jumping in a similar way again. And traders on X say direct payments can act like rocket fuel for market liquidity, which could in turn trigger massive crypto bull runs.

But Then There’s Reality

For now, Trump’s tariff dividend is just a social media pipe dream, and implementing it would require the US Congress to pass a law—and that’s no easy feat. They’d need to write up a bill, get votes in both houses, and get over all the usual political squabbles. No official bill has been floated yet.

Even with all this uncertainty, the crypto markets are still getting pretty pumped. Traders are pricing in the possibility that direct payments could boost liquidity and get more people willing to take on risk, which is why digital assets like Bitcoin and Ethereum are currently holding centre stage.

ABOUT THE AUTHOR See More
Arslan Butt
Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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