Trump's Tariff U-Turn: A 15% Hike and a 2% Bitcoin Pop

The sequence began with a policy shock. On Friday, the U.S. Supreme Court struck down President Trump's tariff regime in a 6-3 decision, ruling it exceeded presidential authority under the International Emergency Economic Powers Act (IEEPA). The news triggered an immediate, if fleeting, reaction in Bitcoin. The price spiked nearly 2%, climbing above $68,000, as traders interpreted the invalidation as a reduction in geopolitical and economic uncertainty.

Trump's response was swift and escalatory. On Saturday, he announced a 15% global tariff hike, a 50% increase from the initial 10% rate, calling the court's decision "anti-American." This move directly contradicted the court's ruling and signaled a continuation of aggressive trade policy. Bitcoin's reaction to this new policy headline was muted and volatile. The price saw an initial uptick of around 0.5% before falling nearly 1% on the news, settling back near $68,000.

The market's choppiness reflected the conflicting signals. The Supreme Court's invalidation suggested a retreat from trade war tensions, while the subsequent tariff hike signaled a defiant escalation. Bitcoin's inability to sustain gains after the Saturday announcement shows how the policy uncertainty itself became a dominant factor, overshadowing any single directional catalyst.

Institutional Flows: The Real Hedge Test

The immediate price pop on Friday was not met with institutional accumulation. On the day the Supreme Court struck down the tariffs, U.S. Bitcoin spot ETFs saw $133.3 million in net outflows. This is the opposite of what you'd expect from a classic hedge play, where institutions buy during perceived macro stress.

The outflows were led by the largest funds, with BlackRock's IBIT shedding $84.2 million and Fidelity's FBTC losing $49 million. This steady bleed suggests institutional conviction was not triggered by the legal uncertainty. Instead, it points to a risk-off positioning, where capital was being trimmed even as the broader market rallied.

The divergence is telling. While Bitcoin's price jumped nearly 2% on the news, the ETF flows tell a story of selective rotation, not broad-based accumulation. The one exception was Solana ETFs, which saw modest inflows, indicating investors were moving within the asset class rather than exiting crypto entirely. For now, the hedge narrative is being tested-and the numbers show institutions are not buying the dip.

Catalysts and Risks: What to Watch Next

The immediate catalyst is the 15% tariff's effective date. The new 10% baseline duty, as detailed in the White House fact sheet, is set to take effect February 24 at 12:01 a.m. eastern standard time. This creates a near-term policy uncertainty, as the authority under Section 122 is limited to 150 days. The market will watch for any Congressional pushback or the administration's plan to extend the duty, which could reignite trade war fears.

The key institutional signal to monitor is a shift in Bitcoin ETF flows. The recent $133.3 million in net outflows suggests a risk-off stance, not a hedge. A reversal to sustained inflows would be a stronger indicator that institutions are viewing the tariff-driven policy risk as a macro hedge, aligning with Bitcoin's inflation narrative. For now, the divergence between price action and ETF flows remains a critical watchpoint.

Finally, watch for any Supreme Court rulings on tariff refunds. The court's earlier invalidation of the IEEPA tariffs opened a legal door for financial claims. A ruling on refunds could trigger a new wave of debate over monetary policy and fiscal responsibility, potentially reinforcing the argument for alternative stores of value like Bitcoin.