Bond Market Backlash: Trump’s Tariff Retreat Sparks Fresh Bitcoin Debate
As Bond Yields Soar and Tariff Plans Falter, Analysts Say Bitcoin Looks Stronger Than Ever
April 23, 2025 – Washington, D.C. – In a week of wild swings for global markets, former President Donald Trump’s abrupt reversal on tariff hikes has sent shockwaves through the U.S. bond market—and reignited interest in Bitcoin as a financial hedge.
Economist and Bitcoin advocate Saifedean Ammous minced no words in his criticism of the Trump administration’s move to retract heightened tariffs less than 48 hours after implementation.
“Trump fought the bond market, and the bond market won,” Ammous wrote on X.
“It was clear how disastrous the tariffs were when bonds began to crash. Expecting that crashing the stock market would somehow boost bonds was a grave miscalculation.”
Tariffs Backfire as Bond Yields Spike
Following Trump’s short-lived tariff escalation—intended to project economic strength—the 10-year Treasury yield surged from under 4% to 4.5%, according to CNBC, revealing deep market unease over inflation and recession fears.
Rather than supporting fiscal stability, the move prompted a massive bond sell-off, undermining confidence in U.S. economic policy and significantly weakening Trump’s bargaining position with China.
“Reversing course half a day after enacting tariffs was absolutely devastating,” Ammous added.
“All the tough talk about China buckling now looks laughable.”
Bitcoin Steps into the Spotlight
While traditional markets reeled, Bitcoin’s role as a hedge asset gained renewed attention. Iliya Kalchev, a market analyst at Nexo, noted that Bitcoin is behaving less like a tech stock and more like a safe haven, especially in light of Trump’s failed tariff strategy and the deepening U.S.-China trade tensions.
Related: Crypto and stocks enter a ‘new phase of trade war’ amid geopolitical risks
This environment is pushing some to rethink monetary strategy altogether—including a return to hard-backed currency systems.
The Bitcoin Standard: Fantasy or Future?
In a bold proposal, Ammous suggested the U.S. could accumulate Bitcoin until it can fully back the U.S. dollar, thereby adopting a Bitcoin standard akin to the gold-backed system of the past.
“Buy Bitcoin until it can redeem every dollar in circulation, then stop printing beyond what you earn. That’s how you fix fiscal discipline,” Ammous argued.
From Gold to Fiat—And Now to Crypto?
The U.S. abandoned the gold standard in 1971, under President Nixon, initiating the fiat era. But Bitcoin, with its fixed supply and decentralized nature, is increasingly seen as digital gold for the 21st century.
Joe Burnett of Unchained predicts that Bitcoin could surpass gold’s market cap within a decade, potentially reaching $1.8 million per coin by 2035.
As bond market volatility continues and tariff diplomacy falters, Bitcoin’s unique properties—scarcity, transparency, and independence—are becoming ever more appealing to a new generation of economists and investors alike.
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