Trump’s Capital Tax Proposal Sparks Fears of Dollar Decline and Crypto Volatility

The Republican-led 'Big Beautiful Bill' includes a controversial provision in Section 899 that would empower the WHITE House to levy taxes on foreign companies from nations deemed discriminatory. Financial analysts warn this could destabilize global markets, triggering capital flight from U.S. assets and potential dollar weakness.

Deutsche Bank's FX chief George Saravelos cautions the policy weaponizes U.S. capital markets, using taxation as economic leverage. Brown Brothers Harriman strategist Elias Haddad notes the timing couldn't be worse—foreign investment is critically needed to finance America's mounting debt.

Market observers suggest such protectionist measures may accelerate de-dollarization trends, potentially driving capital toward alternative stores of value including cryptocurrencies. The proposal comes as institutional players increasingly view digital assets as hedges against fiat currency volatility.