Trump Demands Massive Rate Cut, Hands Out Tariff Letters: Crypto Holds Strong

President Donald Trump has demanded a record-breaking 300 basis point interest rate cut and announced steep new tariffs on 16 nations.

Parth Dubey By Parth Dubey Julia Sakovich Editor Julia Sakovich Updated 3 mins read
Trump Demands Massive Rate Cut, Hands Out Tariff Letters: Crypto Holds Strong

Key Notes

  • Trump is calling for a historic 300 basis point rate cut, far surpassing any previous move by the Fed.
  • Trump has issued a sweeping set of new tariffs on 16 countries, including 50% on Brazil.
  • Bitcoin remains resilient, hitting a new all-time high of $112,014 as US investor demand surged.

President Donald Trump has thrown the markets a curveball once again, demanding a historic 300 basis point interest rate cut, while simultaneously rolling out a sweeping wave of tariffs targeting countries from Brazil to South Korea.

In the face of this fiscal chaos, crypto markets remain defiant, with Bitcoin BTC $111 331 24h volatility: 2.2% Market cap: $2.21 T Vol. 24h: $35.77 B smashing through a fresh all-time high above $112,000.

A cut unlike any in history

Trump’s call for a 300 bps cut would mark the largest single reduction in US interest rate history, triple the 100 bps emergency cut from March 2020. It is important to note that if enacted, Trump’s rate cut would act as short-term jet fuel for risk assets with investors looking for the next crypto to explode.

At the heart of Trump’s argument is the rising interest expense on the national debt, which has climbed to $1.2 trillion annually, or about $3.3 billion per day.

Trump claims that such a cut would save the government roughly $1.08 trillion per year, though closer estimates suggest more realistic savings near $174 billion in the first year, assuming 20% of publicly held debt is refinanced.

Over five years, this could result in cumulative interest savings of around $2.5 trillion — if the Federal Reserve obliges. But such a dramatic cut would shatter historical precedent.

No single cut over 100 bps has ever occurred outside of a recession, and current US GDP growth is tracking a healthy +3.8% year-over-year.

New tariff announcements

President Trump is also escalating trade tensions, announcing new duties on 16 countries, ranging from 50% on Brazil to 25% on Japan, South Korea, and the Philippines via “tariff letters.”

These tariffs, set to go live on August 1, are framed as a defense of American manufacturing. Trump has warned that any retaliation will be met with further increases, and confirmed that no extensions will be granted on existing tariff pauses.

Us appetite for bitcoin is very high

Unbothered by the broader economic uncertainty, Bitcoin surged to a new all-time high of $112,014, as capital continued to flow into digital assets.

Analyst burakkesmeci noted a Coinbase Premium Gap of 42 points, showing that US buyers are paying more per BTC than those on Binance, a clear sign of domestic institutional demand in the country in the face of Trump’s words.

Bitcoin Price Chart | Source: burakkesmeci

In fact, the premium peaked at $87.76 last week, hinting that the US appetite for Bitcoin remains strong, even at elevated price levels.

As traditional markets prepare for turbulence, crypto may continue to act as a hedge against policy unpredictability, whether it’s massive rate cuts, inflation fears, or protectionist trade measures.

Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.

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Parth Dubey

A crypto journalist with over 5 years of experience in the industry, Parth has worked with major media outlets in the crypto and finance world, gathering experience and expertise in the space after surviving bear and bull markets over the years. Parth is also an author of 4 self-published books.

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