The crypto industry has recently experienced a pro-crypto shift in US regulation, with the SEC vowing to lower crypto enforcements and the White House releasing a crypto executive order. However, recent events have shown that crypto is now more vulnerable to macroeconomic factors, with the market losing $2 billion on the day President Trump announced tariffs on China, Canada, and Mexico. If implemented, these tariffs could increase the risk of recession by reducing consumer spending and increasing economic uncertainty. The imposition of tariffs could also have severe spillover effects on Canada and Mexico, potentially pushing them into recession. The uncertainty surrounding these policies can further depress economic activity. While digital assets like Bitcoin have struggled, traditional safe-haven assets like gold have seen increased demand as investors seek refuge amid market volatility and inflationary pressures. If the US continues with aggressive tariff imposition without achieving trade concessions, there could be heightened inflation and sustained market volatility, potentially leading to a recession in partner economies. The costs of trade protectionism extend beyond international commerce and ignoring the risk of recession could be detrimental to consumer confidence and global liquidity.



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