Tariffs and the impact on the BTC outlook

… when risk asset and safe haven narratives collide

“The most important thing in communication is hearing what isn't said.” – Peter Drucker ||

Hello everyone! I hope you had a great weekend and managed to take a break from wild price swings and geopolitical scrambling.

Yet again, a dramatic Monday – seriously, what is it with Mondays in 2025? Last week we had the DeepSeek scare, the Monday before we had the $TRUMP kerfuffle, the one before that we had the devastating LA fires. Yet again, crypto was the only macro market trading during dramatic sentiment shifts.

Today, obviously, I have to talk about the US tariffs imposed on key trading partners Mexico, Canada and China. I also look at how, zooming out, this is positive for BTC.

(Apologies, I have a schedule squeeze today, no audio! Plus, I don’t know how today’s newsletter got so long… ok, maybe I do… so much going on…)

IN THIS NEWSLETTER:

• Tariffs: he promised, he delivered

• An own goal

• Market impact

• Outlook

• The realignment

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WHAT I’M WATCHING:

Tariffs: he promised, he delivered

President Trump has shown the world that he carries out his threats. He has also shown the world that talk of tariffs was not “just” a negotiating tactic.

On Saturday, Trump signed an Executive Order imposing 25% tariffs on imports to the US from Canada and Mexico, except for energy imports from Canada which are getting hit with 10%. Imports from China are facing a 10% tariff affecting all sectors and adding to any tariffs already in force. The measures go into effect early tomorrow.

They are being pushed through under the 1977 International Emergency Economic Powers Act (IEEPA), which enables the President to impose economic penalties in times of crisis. Trump’s first term tariffs went through the usual channels of deliberations and took months to get approved. This time around, the President is going for a “shock and awe” approach and does not want to risk a diplomatic dilution, especially given the severity of the move.

The Executive Order also attempts to head off retaliatory measures by threatening an increase in the assigned rate should any of the targets choose that path.

The threat does not seem to have worked. On Saturday night, Canadian Prime Minister Justin Trudeau announced 25% tariffs against C$155 billion of US imports, starting with coffee, wine, orange juice, peanut butter, cosmetics and motorcycles, with steel, aluminum, cars, trucks, beef and boats among other items to be added later this month.

Mexican President Claudia Sheinbaum has also promised retaliation, with details expected today.

China has stopped short of promising counter-tariffs, but has said it will file legal proceedings with the World Trade Organization.

It seems that we now have an all-out trade war between countries that have been key partners in each other’s economic growth.

An own goal

The economic stakes are high.