Right after tariffs were introduced on aluminum and steel, Bitcoin and other cryptocurrencies almost immediately fell significantly. Why did Donald Trump’s decision heavily impact the crypto market?
Tariffs on steel – what’s going on?
Right before the Super Bowl – the biggest American pop-culture event of the year – Donald Trump announced the introduction of a new tariffs package. This time, the old-new President decided to impose 25% tariffs on all aluminum and steel. Bitcoin, together with other open markets during this announcement, plunged dramatically. Donald Trump suggested that he would make it official “on Tuesday or Wednesday.”
It includes imports from Canada and Mexico, despite their last week’s pause for the next 30 days. Both USDCAD and USDMXN have been experiencing unusual fluctuations during the last couple of days.
Read more: Trump tariffs suspended – for now
Even though the decision is not official, worldwide economies stay alert due to this situation. South Korean acting president Choi Sang-mok investigates how these tariffs can impact not only the steel industry in South Korea but also the national economy and USDKRW exchange rate.
Why are steel and Bitcoin connected?
Bitcoin-USD price has suddenly fallen to $94,000 from $97,000 in hours after the President’s statement. Similar situations happened on altcoins, including Ethereum, Solana, and Injective.
There can be multiple reasons why, after imposing tariffs on aluminum and steel, Bitcoin price suddenly fell. It might be the high dependency of hi-tech solutions on various metals. To create state-of-the-art crypto or AI machinery, it has to be steel, aluminum, or other metals from which they can perform countless operations at the highest level.
However, analysts suggest that the implementation of tariffs is just another brick in the wall of uncertainty. There are signs which might indicate that Bitcoin is in the bearish period. Multiple sudden decisions made by Trump’s administration made investors fear for their trading operations. The total crypto market cap immediately dropped after Trump’s tariffs statement.
U.S. aluminum, steel and Bitcoin: Conclusion
After President Donald Trump announced new tariffs of 25% on aluminum and steel, Bitcoin and other cryptocurrencies experienced a significant drop. This decision includes imports from Canada and Mexico.
The potential impact of these tariffs has global economies on alert, with concerns not only in the steel industry but also in national economies such as South Korea. The connection between steel and Bitcoin might stem from the reliance of high-tech industries, including cryptocurrency and AI technologies, on these metals for advanced machinery.
Analysts suggest that the sudden tariff announcement led to another ingredient to market uncertainties, which might push Bitcoin and other cryptocurrencies into a bearish period.
