How do tariffs and trade wars affect commodities and digital asset prices?

Tariffs are taxes imposed by governments on imported goods and services. They are typically used to protect domestic industries, reduce trade deficits, or as leverage in political negotiations. When multiple countries retaliate by imposing tariffs on each other’s goods, a trade war ensues. Trade wars disrupt global supply chains, increase the cost of goods and slow economic growth, creating widespread uncertainty across markets. Historically, tariffs and trade wars have impacted traditional asset classes (stocks, bonds and commodities) but their influence now extends to emerging asset classes such as cryptocurrencies and other digital assets due to globalisation and the digitisation of finance. As noted by the House of Lords Library: “One criticism of tariffs is that they raise prices for consumers and firms buying goods from abroad, so fuelling inflation. Another is that tariffs mean domestic firms face less competition from imports, reducing their incentive to become more productive…