The US government released a report this week claiming that dozens of countries helped China evade tariffs by routing goods through nations with lower levies. The finding could escalate trade tensions and add to the risk-off mood already gripping global markets, including crypto.
What the report says
The report alleges that China moved goods through third countries to avoid higher US tariffs. It doesn't name the countries involved, but says dozens of them played a role. The US has not yet announced any specific retaliatory measures, but the report is widely seen as a precursor to further trade action.
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Why crypto should care
The immediate impact on digital assets is likely muted. Markets are already fearful, and the report doesn't directly target crypto. But the broader implications are harder to ignore. If the US responds by slapping tariffs on the third-party countries that facilitated the evasion, it would broaden the trade war, disrupt supply chains, and push inflation higher. That would keep central banks hawkish for longer—a headwind for risk assets like Bitcoin and Ethereum.
Yet the same dynamic could work in crypto's favor. The report is evidence that the US-led trade order is fraying, and that the dollar is being weaponized. As more countries seek alternatives to the dollar for trade settlement, Bitcoin's role as a non-sovereign store of value becomes more compelling. The erosion of trust in the US financial system is precisely the kind of macro uncertainty that drives institutional interest in decentralized assets.
The third-country angle
The real crypto-relevant risk isn't China's evasion—it's what the US does next. If Washington imposes secondary tariffs on the countries that helped China, the trade war expands. That would amplify global uncertainty and delay any crypto recovery. It could also trigger stricter US scrutiny of cross-border payments, including stablecoins and exchanges, if regulators suspect digital assets are being used to bypass tariffs. The US has already shown a willingness to target crypto for sanctions evasion; tariff evasion could be the next justification for tighter controls.
What to watch
The next concrete step is whether the US announces retaliatory measures. Any announcement could trigger a flight to safety, temporarily pressuring BTC and ETH. But if the trade war deepens, the case for Bitcoin as a hedge against fiat debasement grows stronger. For now, the report adds to the macro uncertainty that's already weighing on risk assets. Traders will be watching for follow-up statements from the administration.
