Trump's Trade Act tariffs blocked by court; Bitcoin slides to $65K
In brief
- Supreme Court ruled 6-3 in February that IEEPA does not authorize tariffs
- Trump administration imposed 15% global tariffs under Section 122 of 1974 Trade Act
- US Court of International Trade ruled May 7 that Section 122 tariffs exceeded presidential authority
- Bitcoin dropped below $68K amid tariff escalation fears and legal uncertainty
- Tariffs expire late July 2026; administration continues litigation
The Pivot and the Setback
After the Supreme Court shut down the IEEPA route, the administration quickly turned to Section 122 of the Trade Act of 1974. That provision allows the president to impose temporary tariffs to address balance-of-payments deficits. The initial rate was set at 10%, then bumped to 15% on a global basis, with a 150-day clock that puts the expiration somewhere around late July 2026.
The strategy looked plausible in theory. Congress had granted the president tools to manage trade deficits—why not use them? But on May 7, 2026, the US Court of International Trade ruled 2-1 that the Section 122 tariffs were unlawful. The court found that the tariffs exceeded the authority Congress granted for addressing balance-of-payments issues.
Crypto and Markets in Limbo
The legal uncertainty has weighed on risk assets. Bitcoin dropped below $68,000 in February 2026 when tariff escalation fears peaked. Since then, prices moved toward the $65,000 to $68,000 range, a meaningful pullback that coincided directly with tariff announcement and legal chaos.
Traders are watching two paths forward. Congress could pass legislation authorizing the tariffs on firmer legal ground as one possible resolution. Alternatively, the administration continues to litigate. The tariffs remain live until the July deadline. Either way, the legal back-and-forth keeps crypto markets on edge.
