Trump Proposes $2,000 Tariff Dividend as Crypto Markets Rally

TLDR

• President Trump announced a $2,000 tariff dividend for most Americans, excluding high-income earners, funded by tariff revenue
• Cryptocurrency prices rose following the announcement, with Bitcoin climbing to $103,000, Ethereum reaching $3,500, and Solana topping $160
• The Supreme Court is currently hearing arguments about tariff legality, with prediction markets showing only 21-23% odds of approval
• Congressional approval is required for the dividend payment, and experts say tariff revenue collected so far ($120 billion) falls short of the estimated $300 billion needed
• Tax experts note that after accounting for economic effects, net tariff revenue is only around $90 billion, creating a funding gap for the proposed dividend

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President Donald Trump announced on Sunday that most Americans will receive a $2,000 dividend funded by tariff revenue. The announcement came through his Truth Social platform, where he stated the money would both reduce the national debt and provide direct payments to citizens.

Source: Truth Social

The cryptocurrency market responded positively to the news. Bitcoin rose 1.93% over 24 hours to trade above $103,000.

Ethereum climbed 4.75% to surpass $3,500. Solana gained 2.49% to top $160, while the CoinDesk 20 index increased more than 1.5%.

The rally comes after a difficult week for crypto markets. The CD20 index had dropped nearly 15% before starting to recover.

Bitcoin remains down 5.7% for the week. Ethereum is still down 7.5% despite the recent gains.

Bitcoin (BTC) Price

Legal and Financial Hurdles

The Supreme Court is currently hearing arguments about the legality of Trump’s tariff policies. Prediction markets show low confidence in court approval.

Kalshi traders place the odds at just 23%. Polymarket traders have the odds slightly lower at 21%.

Implementation Challenges

The proposed dividend faces several obstacles before it could reach Americans. Andy Constan, CEO of Damped Spring Advisors, noted that the President cannot authorize this payment alone.

Federal spending decisions require Congressional approval. Any plan to distribute tariff-collected funds must go through the legislative branch.

The math presents another challenge. Erica York, vice president of Federal Tax Policy, calculated that if the income cutoff is $100,000, about 150 million adults would qualify.

This would cost approximately $300 billion. If children qualify, the cost would grow even higher.

Tariffs have only raised $120 billion so far. This creates a gap between available funds and the proposed dividend cost.

York explained that the economic effects of tariffs further reduce net revenue. Every dollar raised through tariffs offsets about 24 cents of income and payroll tax collections.

After these adjustments, net tariff revenue stands at around $90 billion. This is far below the $300 billion needed for the dividend program.

Investment analysts at The Kobeissi Letter estimate that about 85% of US adults should receive the stimulus checks based on COVID-era distribution data. Bitcoin analyst Simon Dixon suggested that recipients should invest the money in assets to protect against inflation.

Investor Anthony Pompliano said stocks and Bitcoin typically rise in response to stimulus. Traders appear to be pricing in potential crypto market inflows if the funds reach recipients.

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