Will Trump Tariff Refunds Fuel the Next Crypto Rally?

Key Insights

• A key question is whether Trump tariffs will fuel the next crypto rally.
• Most of the $159 billion refunds will go to companies.
• Chances are that these companies will not buy Bitcoin and other altcoins.

Bitcoin held above $80,000 this week as traders assessed whether Trump-era tariff refunds could inject fresh liquidity into financial markets. The broader crypto market also remained stable, with total digital asset capitalization hovering near $2.7 trillion.

The discussion followed renewed attention on a Supreme Court ruling tied to tariffs imposed under the International Emergency Economic Powers Act (IEEPA). While some investors viewed the refunds as a possible liquidity catalyst, analysts remained skeptical that the payments would directly flow into cryptocurrencies.

Supreme Court Ordered Tariff Refunds

The Supreme Court of the United States (SCOTUS) made a major blow to Donald Trump’s agenda in February this year when it ruled against his tariffs. Precisely, the court ruled that Trump erred when he imposed tariffs using the International Emergency Economic Powers Act (IEEPA).

As part of the ruling, the court asked the administration to refund companies that paid the tariffs. Data shows that the administration will now pay over $159 billion to all eligible companies. Estimates indicate that over 300k companies are eligible to apply for these refunds. Some of the most notable ones are Philips, Costco, Apple, and Amazon.

An influx of over $159 billion to the economy should be seen as a stimulus package. In some instances, if the funds land to consumers ‘ hands, some of them may want to buy risky assets like cryptocurrencies.

The challenge, however, is that companies are asking for refunds, meaning they will not use the funds to buy cryptocurrencies.

According to a report from the Wall Street Journal, several companies plan to return portions of the money to customers. Others intend to offset prior tariff expenses, rebuild inventories, or reduce credit obligations.

That distinction matters because corporations are less likely than retail investors to deploy excess cash into speculative assets such as cryptocurrencies.

Some analysts also warned that the refunds could complicate inflation expectations if the additional liquidity boosts economic activity. Persistent inflation could reduce expectations for Federal Reserve rate cuts, a scenario that has historically pressured risk assets.

Potential Catalysts for a Crypto Rally

Still, there are some potential catalysts for a crypto market rally. The first and most important one is the ongoing accumulation by retail and institutional investors. Data shows that spot Bitcoin, Ethereum, and altcoin ETFs have gained substantial inflows in the past few months. Bitcoin ETF inflows have jumped by over $5 billion since the Iran war started.

Additionally, there are signs that investors have embraced a risk-on sentiment. For example, the Crypto Fear and Greed Index has jumped from the extreme fear zone of 10 to the neutral point of 50. That is a sign that it may move to the greed zone, a move that may boost Bitcoin and other tokens.

Technicals suggest Bitcoin’s price may be on the verge of a strong rally, which could trigger a broader crypto rally. As the chart below shows, the coin has just moved above the 50-day Exponential Moving Average (EMA).

It has also jumped above the key resistance level at $76,000, the upper side of the ascending triangle pattern. An ascending triangle often leads to more gains over time. If this happens, the coin may surge to the next key resistance level at $90,000 followed by $100,000.

The crypto rally may also be triggered by the ongoing gains in the stock market. Data shows that the Nasdaq 100 and S&P 500 indices have both soared to record highs. In most cases, crypto prices tend to follow suit when this happens.

Historically, Bitcoin and major altcoins have often tracked gains in equities during periods of improving investor confidence and rising liquidity expectations.

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