Tariff Refunds Could Reshape Market Liquidity as SCOTUS Trump Decision Looms

Court Case Set to Determine $150-200 Billion in Potential Refunds Liquidity Shifts May Ripple Through Crypto and Traditional Markets Bitcoin Slides Below $96K as Traders Weigh Policy Implications

A forthcoming Supreme Court decision could unlock substantial tariff-related refunds while reshaping how capital flows across financial markets. The case centers on whether President Trump possessed the authority to impose tariffs via emergency powers without legislative approval, with the ruling potentially arriving as soon as January 9.

The SCOTUS Trump Tariff Case: What’s at Stake

The Supreme Court is deliberating on whether the International Emergency Economic Powers Act permitted the administration to implement tariffs unilaterally. During November’s oral arguments, multiple justices voiced skepticism about granting such expansive authority under the legislation.

Prediction markets signal considerable uncertainty. Polymarket indicates roughly 24% probability that the court fully supports Trump’s tariff actions, while Kalshi estimates 27%. This divided outlook reflects how the decision remains genuinely contested.

Should the court invalidate the tariffs, businesses that absorbed these costs face eligibility for substantial refunds—potentially totaling $150 billion to $200 billion over the coming months. Such repayments would effectively reverse a critical revenue stream for federal finances.

Fiscal Consequences and Market Implications

A ruling against the tariffs creates fiscal headwinds for government budgets. JPMorgan research suggests that annualized tariff revenue could contract from approximately $350 billion to roughly $250 billion if the administration pivots toward alternative legal strategies with lower collection rates.

Revenue shortfalls typically force Treasury departments to increase debt issuance. When governments borrow more aggressively, bond yields climb higher, redirecting investor capital toward fixed-income securities. This dynamic historically tightens liquidity conditions for equities and alternative assets like cryptocurrencies.

For the corporate sector, tariff refunds represent a reversal of the fiscal squeeze many businesses endured. Manufacturers and importers that absorbed higher costs stand to recover substantial cash reserves. Market participants anticipate this capital could be redeployed across operations, balance sheet optimization, and financial markets throughout 2026.

Crypto Markets Navigate Uncertainty

Bitcoin currently trades near $95.56K, declining approximately 1.98% over the last 24 hours. Ethereum hovers around $3.30K, also down 2.21% during the same period. Market participants are closely monitoring how the decision might influence asset performance.

Historically, crypto markets have demonstrated resilience during tariff-related volatility. CoinDesk Indices analysis of the first-quarter 2025 “Tariff Tantrum” revealed that price corrections were temporary, primarily stemming from liquidations and deleveraging rather than sustained selling pressure.

Jose Torres, economist at Interactive Brokers, notes that even if the court curtails tariff authority, the administration will likely pursue alternative legal pathways. Narrower measures could extend fiscal uncertainty longer, potentially weighing on digital assets during periods of rising yields.

However, other strategists suggest an alternative scenario: companies receiving refunds may allocate portions of capital toward non-traditional investments, including crypto, particularly if regulatory frameworks clarify and inflation concerns persist.

Regulatory Environment Shifts in Crypto’s Favor

Beyond immediate court uncertainty, the broader regulatory landscape for digital assets is evolving favorably. TD Cowen’s Washington Research Group recently highlighted 2026 as a distinctive window where White House, Treasury, and financial regulators are adopting more supportive stances toward crypto innovation.

The group expects regulatory progress through targeted guidance, operational exemptions, and selective rule modifications rather than comprehensive legislative action. However, critical initiatives must conclude before 2029 to survive potential political realignment following the 2028 presidential election.

This regulatory backdrop suggests that even if SCOTUS Trump decisions create near-term market noise, longer-term conditions for crypto adoption and investment may be improving.