President Donald Trump announced on Sunday that Americans will receive a payment of at least $2,000 funded by tariff revenue.
The announcement sent cryptocurrency prices higher as traders remembered what happened the last time the government sent direct payments to citizens.
Trump posted on Truth Social that the U.S. is taking in “trillions of dollars” from tariffs. He said these funds will help pay down the $37 trillion national debt and provide a dividend to Americans. However, high-income earners would not receive payments.
The announcement triggered immediate reactions in crypto markets. Bitcoin jumped approximately 1.9% over 24 hours to trade above $103,000. Ethereum climbed about 4.8% to surpass $3,500. Solana gained approximately 2.5% to top $160. The CoinDesk 20 index, which tracks major cryptocurrencies, rose more than 1.5%.
The Math Doesn’t Add Up
While the announcement excited investors, experts quickly pointed out major problems with the plan. If the income cutoff sits at $100,000, roughly 150 million adults would qualify. That means the government would need about $300 billion to fund the program.
The problem? New tariffs have only raised $120 billion so far this year. Even worse, every dollar collected through tariffs reduces other tax revenue by about 24 cents. This happens because tariffs slow economic activity, which means less income and payroll tax collection. After accounting for these offsets, net tariff revenue stands at only $90 billion—far short of what’s needed.
Source: @realDonaldTrump
The Treasury Department’s final monthly statement shows that total tariff collection reached $195 billion for fiscal year 2025, which ended September 30. This represents a 150% increase over 2024. Monthly collections jumped from $7 billion in January to $30 billion by September.
Supreme Court Could Kill the Entire Plan
The biggest threat to Trump’s tariff dividend comes from the Supreme Court. The court heard arguments on November 5 about whether Trump legally imposed his tariffs using emergency powers.
Both conservative and liberal justices expressed strong skepticism during the hearing. Chief Justice John Roberts pointed out that the law Trump used says nothing about tariffs. He noted that tariffs are taxes on Americans, and the Constitution gives Congress—not the president—the power to levy taxes.
Prediction markets show investors don’t expect the court to side with Trump. Kalshi traders put the odds of approval at just 23%. Polymarket traders estimate only 21% chance of success.
If the Supreme Court rules against Trump, the government might have to refund up to $90 billion already collected. This would eliminate the funding source for any dividend payments.
What Happened Last Time
Crypto traders remember the 2020-2021 stimulus period very well. Between March 2020 and November 2021, Bitcoin surged over 1,000%, climbing from around $6,000 to $69,000. Someone who invested all three COVID stimulus payments (totaling $3,200) into Bitcoin would have holdings worth over $50,000 today.
The real explosion happened in alternative cryptocurrencies. Bitcoin’s share of the total crypto market crashed from 73% to 39% in just six months. Retail investors poured money into everything from Ethereum to meme coins like Dogecoin and Shiba Inu.
Research backs up these patterns. A 2023 Harvard Kennedy School study found that stimulus payments drove people toward crypto investments. When households had extra money, they took more risks. At the same time, inflation fears pushed investors to seek alternatives to traditional assets.
Nearly 1 in 10 Americans used stimulus checks to buy cryptocurrencies during the pandemic. Among households making over $100,000 annually, this number jumped to 14% for the third stimulus check.
This Time Looks Different
Several major factors have changed since 2020, which could limit any crypto rally from tariff dividends.
Interest rates now sit above 4% compared to near-zero during the pandemic. Higher rates make risky investments less attractive. Back then, the Federal Reserve was buying trillions in bonds and flooding the system with money. Today’s environment is much tighter.
The crypto market has matured significantly. In 2020, there were no Bitcoin ETFs, custody was fragmented, and regulations were unclear. Retail investors drove 80-90% of flows. Today, institutions dominate the market. Spot Bitcoin ETFs exist, and billions flow into regulated products. This institutional presence could limit wild price swings.
Market size matters too. The total crypto market cap now hovers around $4 trillion, up from $3.4 trillion at the end of 2024. Larger markets typically move slower than smaller ones.
Congressional Approval Required
Even if the Supreme Court allows the tariffs to stand, Trump still needs Congress to approve the dividend payments. Republican Senator Josh Hawley of Missouri introduced legislation in summer 2025 for tariff rebates. His bill would guarantee at least $600 per person.
But many Republican senators oppose the plan. Senator Rand Paul called it “ridiculous” given America’s massive debt. Treasury Secretary Scott Bessent has said the administration’s priority is using tariff revenue to pay down debt, not fund new spending.
JPMorgan economists warned that sending stimulus checks in a full employment economy could backfire. Unlike the pandemic, when millions were unemployed, the economy is currently near full employment. Pumping cash into this environment could drive inflation higher, especially since tariffs already increase costs for imported goods.
The Verdict: Hope vs. Reality
Crypto traders are betting on possibility rather than certainty. The memory of 2020-2021 gains creates excitement, but the path to actual payments faces massive obstacles.
Legal challenges, Congressional gridlock, funding shortfalls, and changed market conditions all work against a repeat of the pandemic-era crypto boom. Even if payments somehow materialize, they likely won’t arrive for many months.
For now, the modest price bump in cryptocurrencies reflects traders pricing in potential consumer spending—not the certainty of it happening. Whether Trump’s “dividend to the people” ever reaches American wallets remains highly uncertain as 2025 draws to a close.