Grayscale, which manages billions of Dollars, said "Customs duties will benefit Bitcoin" and explained the reason!

As U.S. President Donald Trump signals a return to aggressive tariff policies, uncertainty in the market is also increasing. While these developments may contribute to short-term weakness in the price of Bitcoin, a new report from crypto asset manager Grayscale suggests that the long-term effect could be bullish for the leading digital asset.

In the report, Grayscale indicates how rising tariffs and protectionist policies could drag the US economy into a period characterized by stagflation ( with rising inflation and stagnant economic growth ). Historically, stagflation has been negative for traditional assets like stocks and bonds, but beneficial for rare commodities.

The report states, "Bitcoin is too young for us to know how it will behave in the past" and adds: "However, historical data shows that stagflation tends to be negative for traditional asset returns but positive for rare commodities like gold."

To support this claim, the report refers to the 1970s, a period of significant stagflation, where gold appreciated in value by approximately 30% annually and inflation remained significantly high. Grayscale suggests that Bitcoin, often referred to as "digital gold," could behave similarly under similar economic conditions.

The report also addresses the geopolitical effects of Trump's tariff agenda beyond inflationary concerns. According to the report, trade tensions could weaken global confidence in the US dollar and US dollar-centered financial systems.

Grayscale says, "If commercial tensions lead to a weakening of ties with the U.S. economy and/or U.S. dollar-centered financial markets, countries may accelerate the diversification of their foreign exchange reserves." Such a shift could encourage greater adoption of decentralized assets like Bitcoin as part of this diversification strategy.