The implementation of US reciprocal tariffs: What will happen to the world economy, Bitcoin and altcoins?

Hey, coin friends, today we are talking about a big thing - the US reciprocal tariff policy has officially been implemented! This has been brewing since Trump came to power. On the morning of April 3, the market was in full swing, with Nasdaq futures crashing by 5%, and Bitcoin once fell to $82,000. This is not a small fuss, it feels like throwing an economic nuclear bomb, affecting the global economy. Next, I will take you to explain how this wave of operations will affect the world economy and the currency circle.

1. Impact on the world economy: Trade war 2.0 is coming?

Let’s talk about the world economy first. This reciprocal tariff policy, to put it simply, is “for tooth”. The United States will impose a 10% benchmark tariff on all regions around the world starting from April 5, and will increase higher special tariffs on 60 specific regions starting from April 9. Does this trick sound familiar? Yes, it’s the flavor of Trump’s trade war back then, but this time it’s more ruthless and comprehensive. The goal is clear: reduce the trade deficit, bring manufacturing back to the United States, and save more money for the finance department.

But this matter is not that simple! The global supply chain is like a spider web. If you move here, you will have to mess up there. For example, China, Mexico, and Canada, the major trading partners of the United States, are probably going to have a headache. With one plus tariffs, export costs have risen sharply, and American consumers have to pay more for buying things, and inflationary pressures have immediately risen. Not to mention that other countries may not be outdone. Canada has already pleaded with retaliatory tariffs, and the EU is also sharpening its knives and preparing to fight back. If this breaks into a full-scale trade war, global economic growth will be defeated.

In the short term, the US economy may have a little sweetness. After all, tariffs can charge a little more money, and it is estimated that the return of manufacturing will be increased by 400 billion. But what about the long term? Economists are worried about "stagflation" - economic stagnation and inflation soaring. Think about the Fordney-McCumber Act of 1922, when high tariffs directly dragged global trade into the quagmire and eventually triggered the Great Depression. Will history repeat itself this time? It's hard to say, but the market is already scared. The 5% dive in Nasdaq Futures is not a joke.

**2. Bitcoin: Being beaten in the short term, but being bullish in the

long term?**

Let’s look at Bitcoin again. This wave of tariffs has been hit by Bitcoin and fell off guard, falling from around $100,000 to $82,000, a drop of more than 10%. Why? Because BTC is now deeply linked to risky assets, when the market panics, everyone will sell risky assets first and run away, so BTC will naturally not be able to escape. In addition, tariffs may push up inflation, and the Fed's expectation of interest rate hikes has risen again. High interest rates are not good news for "zero interest assets" like BTC.

But don't worry, this guy from Bitcoin is very resilient. The short-term decline is still the decline, but in the long run, I think there is still a chance. Why do you say that? First of all, inflation and economic uncertainty caused by tariffs may make more people treat BTC as "digital gold" to avoid risks. In the past few years, every time there is a turbulence in the global economy, Bitcoin can always find opportunities for rebound. For example, when the "mask" in 2020, BTC surged from more than 10,000 US dollars to more than 60,000 yuan in one go. Look at the moment, the Trump administration is quite friendly to cryptocurrencies. He even mentioned that he wanted to build a "national Bitcoin reserve". Isn't this just a spoiler for BTC?

There is another thing to raise, tariffs will increase mining costs a lot. The main BTC mining forces are in China and North America, and mining machines and chips are mostly imported. With OnePlus, the price of mining machines may rise by more than 20%, and the mining cost will jump by about 17%. Small miners have a hard time, and big miners may have to grit their teeth and carry it. But this may actually push up BTC prices - the supply side is under great pressure, isn’t the scarcity more obvious? Therefore, in the short term, BTC may still have to fluctuate for a while, but in the medium and long term, I am still optimistic. 100,000 yuan may just be the starting point.

3. Altcoins: A life that follows the decline but not the rise?

Let’s talk about altcoins. The relationship between these younger brothers and their elder brother BTC is really “the same decline and the same rise.” As the tariffs were implemented, BTC fell, and altcoins were all over the ground. Why? Because altcoins are more "risk" than BTC and are more speculative, whenever there is a turmoil in the market, funds will run here first.

But altcoins are not completely out of the blue. The impact of tariffs on them is actually a bit similar to BTC, but it is a bit different. For example, ETH and Nasdaq have a higher correlation than BTC. This time, the US stock futures collapsed, so ETH naturally cannot escape. But ETH has its own fundamental support - DeFi, NFT, and smart contracts are still developing, and it still has potential in the long run. For example, those altcoins linked to the real economy, such as VeChain (VET), which is related to the supply chain, will cause global trade chaos, which may bring them opportunities.

However, there is a big problem with altcoins: poor liquidity and many retail investors. The market panic caused by this wave of tariffs is probably going to cause many small currencies to "zero". Therefore, in the short term, altcoins are likely to be "following the decline but not rising". Only those who survive this cold winter are probably the top ones. Friends who want to buy at the bottom, have to be at ease and don’t dive into the pit

4. How to go in the future? Look at these points

The impact of this wave of reciprocity has just begun. How to go ahead depends on a few things:

1. The strength of counterattacks from other countries : If Canada, the EU, and China all come back and the trade war escalates, the global economy and crypto markets will have to shake a few more times.
2. The Fed 's reaction : If inflation really rises, will the Fed raise interest rates? How much to add? This is the key to affecting BTC and altcoins.
3. Trump 's crypto policy : If he really promotes the "Made in the United States" crypto industry, such as supporting BTC mining and building national reserves, market confidence will be much warmer.
4. Market sentiment : Don’t underestimate the power of retail investors. This wave of panic has passed. Will you come back to grab BTC and altcoins?

5. Advice to investors

Finally, let’s talk about something practical. Faced with this wave of tariff shock, what should ordinary investors do? I have a few suggestions:

• BTC : Don’t rush to buy at the bottom in the short term. When the market sentiment stabilizes, if you can hold it around $82,000, you can consider building positions in batches.
• Altcoin : Choose the top projects, don’t touch small currencies. You can still see those with strong ecology such as ETH and BNB.
• Cash is king : There is such high uncertainty, so keep some cash in hand, it will not be too late to take action when the opportunity comes.

In general, the US's reciprocal tariffs are a double-edged sword in the short term, and the world economy and crypto markets will be hit. But in the long run, BTC may take the opportunity to turn over, and altcoins can also run into dark horses. We people who are eating melons, just keep an eye on the changes in the situation and find the right opportunity to start! If you have any ideas, please leave a message to discuss!