Corporate Bitcoin Treasuries Lose $4 Billion After US Tariff Hike

Corporate Bitcoin treasuries collectively experienced a significant decline, shedding more than $4 billion in value following the implementation of new tariffs by the United States. The tariffs, announced by President Donald Trump on April 2, triggered a global market sell-off, causing widespread adjustments in the global market. The U.S. imposed a 10% tariff on all imports and additional duties on goods from 185 countries, which were deemed the "worst offenders" in terms of perceived unfairness in trade. These new tariffs were set to take effect on April 9, leading to price increases and potential supply chain disruptions across various sectors, including technology and manufacturing.

The tariff hike was part of a broader trade policy aimed at addressing trade deficits. President Trump had previously stated that the impetus behind the tariff policy was to eliminate trade deficits, which he described as losses. The global market reacted swiftly to the tariff announcement, with stock markets experiencing significant volatility. The U.S. stock market saw its worst week since 2020, and the impact was felt across various regions. Countries began to respond with their own countermeasures, further exacerbating the market turmoil.

The tariff hike had a direct impact on corporate Bitcoin treasuries, which saw a sharp decline in value. As of April 7, corporate Bitcoin holdings were worth approximately $54.5 billion in the aggregate, down from roughly $59 billion before April 2. The global market sell-off, triggered by the tariff announcement, led to a significant drop in the value of Bitcoin holdings by corporations. This decline was attributed to the uncertainty and volatility caused by the new trade policies, which affected investor confidence and market stability.

The losses highlight ongoing concerns about Bitcoin’s increasing popularity as a corporate treasury asset. Historically, corporate treasuries hold extremely low-risk assets like US Treasury Bills. The cryptocurrency’s volatility has also weighed on publicly traded Bitcoin holders’ share prices. The Bitwise Bitcoin Standard Corporations ETF (OWNB) — an exchange-traded fund (ETF) tracking a diverse basket of corporate Bitcoin holders — has lost more than 13% since Trump announced sweeping US import tariffs on April 2. Even shares of Strategy — the de facto Bitcoin hedge fund founded by Michael Saylor that pioneered corporate Bitcoin buying — are down, clocking losses of more than 13% since April 2.

“Cryptocurrencies' high volatility and uncertain regulatory landscape are misaligned with the fundamental goals of treasury management [such as] stability, liquidity, and capital preservation,” David Krause, a finance professor at Marquette University, said in a January research publication. The tariff hike and its impact on corporate Bitcoin treasuries underscore the interconnected nature of global markets. The decisions made by one country can have far-reaching effects, influencing not only traditional financial markets but also emerging asset classes like cryptocurrencies. As the global economy continues to evolve, it is crucial for corporations and investors to stay informed about potential disruptions and adapt their strategies accordingly.