The Supreme Court of the United States on Friday delivered a significant blow to President Donald Trump's economic agenda, striking down his expansive global tariff regime with a 6-3 ruling. The Court determined that President Trump had overstepped his constitutional authority by imposing broad import duties under the International Emergency Economic Powers Act (IEEPA), a statute typically reserved for sanctioning foreign adversaries during crises. These invalidated tariffs, first levied in early 2025, were justified by Trump based on persistent trade deficits and national security concerns, including the issue of fentanyl trafficking, and ranged from 10% to 50% on goods from most major trading partners.

Chief Justice John Roberts, writing for the majority, emphasized the clear constitutional allocation of taxing power, stating, "The Framers did not vest any part of the taxing power in the Executive Branch." He further noted that no previous president had utilized the IEEPA to impose tariffs of such "magnitude and scope." This landmark decision marks the initial major legal challenge to Trump’s second-term economic policies to reach the high court, a court that includes three justices appointed by Trump during his first term. Lower courts had consistently sided against the administration, reiterating that Article I of the Constitution unequivocally assigns the authority over tariffs to Congress.

In the wake of the ruling, President Trump reportedly indicated that he has a contingency plan to pursue tariffs through alternative means. Financial markets reacted swiftly and with a degree of uncertainty. Bitcoin, a prominent digital asset, saw an immediate upward movement, climbing approximately 2% within minutes of the announcement to briefly surpass $68,000 before settling back near $67,500. This reaction mirrors a common trend in digital asset markets where headline-driven surges often struggle to maintain their gains, underscoring the ambiguity surrounding the ruling's broader economic ramifications.

For some investors, the invalidation of these tariffs is a welcome development, removing a source of policy uncertainty that has exerted pressure on global trade. However, others view the decision as introducing new questions concerning fiscal gaps, potential refund obligations, and the White House's subsequent policy direction. Reports from Reuters suggest that over $133 billion in tariff revenue, collected under the emergency authority, could be subject to refunds. While Trump has claimed his wider tariff program generated around $600 billion, this figure remains contentious. Should substantial amounts require repayment, the Treasury's financing needs could shift significantly, a critical consideration for current bond markets.

The Supreme Court’s decision came against a backdrop of complex economic data released earlier the same day. The Commerce Department reported that the U.S. economy expanded at a 1.4% annualized rate in the final quarter of 2025. Concurrently, the core personal consumption expenditures (PCE), the Federal Reserve's preferred inflation metric, increased by 3% year-over-year, exceeding market expectations. Despite this, annual economic growth for 2025 slowed to 2.2%, representing the weakest pace since 2020. Art Hogan, chief market strategist at B. Riley Wealth, described this economic picture as conveying a "messy message" of persistent inflation alongside decelerating growth, according to CoinDesk, which reinforces the Federal Reserve's cautious stance on future interest rate cuts.

Regarding Bitcoin, traders have viewed the tariff case less through the lens of direct trade flows and more in terms of its implications for global liquidity and risk appetite. In past periods of trade escalations, digital assets often tracked equities as investors adjusted their assessments of growth and inflation risks. While a court decision that eliminates tariffs could gradually alleviate cost pressures, the immediate impact hinges on how Washington addresses any resultant fiscal deficits. Stephen Coltman, head of macro at 21Shares, had previously suggested that an unfavorable outcome for the administration could weaken the dollar and Treasuries while potentially benefiting stocks and Bitcoin. Conversely, others, like VanEck’s Matthew Sigel, have posited that reduced tariff revenue might widen deficits, thereby enhancing the appeal of assets such as Bitcoin, which are often perceived as hedges against currency debasement. Online prediction markets had largely anticipated the court’s decision to strike down the tariffs, indicating that many traders were already prepared for the announcement. Ultimately, the ruling curtails presidential authority over tariffs, returning legislative power to Congress. The path forward—whether lawmakers choose to institutionalize aspects of Trump’s trade agenda or forge a new course—remains to be seen, with Bitcoin currently trading near $67,600.