Why Trump’s Greenland standoff is sending gold soaring and crypto tumbling

Chances are good that many investors are happy today is a holiday, and thus the stock markets are closed. That’s because over the weekend, President Donald Trump announced the threat of new tariffs levied against America’s most prominent European allies. 

But this time, Trump’s tariff threats aren’t driven by trade imbalances. Instead, they center around the president’s desire to acquire ownership of Greenland. Here’s what you need to know, including how assets that are trading today—gold and cryptocurrency—are reacting.

What’s happened?

On Saturday, Trump took to social media to announce that he would impose additional tariffs on eight European nations that have spoken out against his plan to acquire Greenland from the Kingdom of Denmark.  

The president announced that, beginning on February 1st, goods from those nations will be charged an additional 10% tariff when they enter the United States. The nations Trump threatened to levy the additional tariffs against include: Denmark, Finland, France, Germany, the Netherlands, Norway, Sweden, and the United Kingdom.

But Trump didn’t stop there. He also announced that those additional 10% tariffs would rise to 25% on June 1 and “will be due and payable until such time as a Deal is reached for the Complete and Total purchase of Greenland.”

Currently, there is already a 10% tariff on goods from the United Kingdom and a 15% tariff on goods from the other countries Trump cited. The additional Greenland tariffs would raise the levies on goods from those countries to at least 25% next month and at least 40% in June.

Trump’s stated reason for wanting Greenland to become part of the United States is its strategic national security importance—the landmass lies directly between North America and Russia. However, Greenland is also home to vast mineral deposits and other natural resources with significant market value.

Trump’s desire to acquire Greenland is deeply unpopular with the American public, a Reuters/Ipsos poll found this month, with just 17% of respondents approving of the goal. A 2025 Verian poll of Greenlanders found that an overwhelming 85% of respondents said they did not want their homeland to become part of the United States.

How has Europe responded?

European leaders are in crisis mode. Despite leaders on the continent telling President Trump that Greenland is not for sale, Trump’s resolve on acquiring the Danish territory has only strengthened. On Sunday, the European Council (EC) of the European Union issued a definitive statement on the matter.

“Territorial integrity and sovereignty are fundamental principles of international law. They are essential for Europe and for the international community as a whole,” European Council president António Luís Santos da Costa and European Commission president Ursula von der Leyen wrote.

They added, “The EU stands in full solidarity with Denmark and the people of Greenland. Dialogue remains essential, and we are committed to building on the process begun already last week between the Kingdom of Denmark and the US. Tariffs would undermine transatlantic relations and risk a dangerous downward spiral. Europe will remain united, coordinated, and committed to upholding its sovereignty.”

How had gold reacted?

Geopolitical uncertainties tend to send investors fleeing from more volatile assets, such as stocks, to safer ones, such as gold. And Trump’s weekend escalation over Greenland is following this trend.

While stock markets are closed today in observance of Martin Luther King Jr. Day, assets such as gold and other precious metals are being traded. Gold, particularly, is seen as a safe-haven asset that investors flee to in times of uncertainty. 

As of the time of this writing, gold is currently at an all-time high of $4,671.10 per ounce. Silver is also at an all-time high of $93.20 per ounce.

How have Bitcoin and other cryptocurrencies reacted?

Precious metals aren’t the only assets being traded today. Unlike the stock markets, which are closed on federal holidays, cryptocurrencies trade 24/7.

And unlike gold, cryptocurrencies are generally not seen as safe-haven assets. Cryptocurrencies are historically volatile in the best of times. When geopolitical uncertainties hit, crypto tends to sell off as investors take profits and move into safe-haven assets.

As of this writing, most major cryptocurrencies are retreating amid the rising geopolitical and economic uncertainty between America and its European allies.

Crypto king Bitcoin is currently down more than 2% to $93,170 per coin. Ethereum is down nearly 3%, XRP is down nearly 4%, and Solana is down nearly 6%. Memecoin Doge is down nearly 7%.

Where do things go from here?

Right now, no one can say where Trump’s Greenland escalations go from here. Most of the political establishment in America and the overwhelming majority of the international community are deeply concerned about the president’s insistence on acquiring the landmass.

Numerous observers, including European leaders, have said that Trump’s threats could undermine the very foundation of NATO, of which the U.S., Greenland, and European countries are part.

Right now, European leaders are debating how to respond to Trump’s threats if the president does not back down. If diplomatic efforts fail, the next most likely step would be for Europe to threaten economic countermeasures against America, including tariffs of its own on American goods, and perhaps even invoking what is colloquially called the “big bazooka”—officially known as the Anti-Coercion Instrument (ACI).

As CNBC noted, the ACI is a trade policy tool in the EU’s arsenal designed to counter coercion by economically and militarily powerful countries. The ACI is a deterrent instrument that, if enacted, could restrict not just trade with a country, but also place a cessation on foreign investment and intellectual property rights. The ACI was created in 2023, but it has never been enacted before.

All eyes will be on Trump when he is in Europe on Wednesday, where he will address world and business leaders at the World Economic Forum in Davos, Switzerland.