By Omkar Godbole (All times ET unless indicated otherwise)
Major cryptocurrencies witnessed a significant reversal from early gains following Beijing’s announcement of retaliatory tariffs against the U.S. These developments came in response to President Trump’s recent decision to impose additional levies on China and other nations, sparking increased trade tensions.
Bitcoin, for instance, dropped from $84,600 to $83,000. Interestingly, the declines appeared to be limited, possibly because the market had already braced for such news. Markets often react more adversely to uncertainty than to confirmed threats, and with these tariffs firmly on the table, some investors may feel a sense of relief that looming fears have been realized.
Since Trump’s inauguration on January 20, markets have grappled with the potential for tariffs and a possible global trade war, resulting in a significant fall in Bitcoin’s price from its record high of over $109,000 to under $80,000 last month. This week, the Trump administration announced sweeping tariffs affecting 180 nations, raising concerns, particularly for countries like China, the European Union, and Southeast Asia.
This episode, often dubbed ‘tariffagedon,’ may signal the end of prolonged uncertainties, potentially liberating markets. Following this announcement, bond yields across developed markets saw declines, indicating a shift towards disinflation contrary to widespread expectations predicting stagflation—a scenario characterized by simultaneous high inflation and slow growth.
The yield on the U.S. 10-year Treasury bond dipped below 4% for the first time since October, along with significant reductions in yields across the UK, Germany, and Japan. Moreover, oil prices also fell sharply this week amid expectations of higher supply from OPEC countries.
These trends could signal favorable conditions for potential Fed rate cuts and risk assets, including cryptocurrencies. In light of the March jobs report due this week, if the outcomes exceed forecasts, they may be perceived as outdated, not fully accounting for the implications of this week’s tariff-related developments. Conversely, a weaker report could intensify the case for Fed rate cuts.
With major macro uncertainties seemingly behind us, the crypto market might refocus its attention on positive news, such as the IPO filing by USDC issuer Circle and notable technological advancements. In another positive development, Coinbase Derivatives filed documentation with the CFTC to self-certify futures for XRP, anticipating regulatory approval. Additionally, Ethereum developers have targeted May 7 for the crucial Pectra upgrade on the mainnet.
The upcoming weeks promise to be eventful. For instance, the SEC’s acknowledgment of Fidelity’s filing for a spot exchange-traded fund tied to Solana (SOL) edges closer to regulatory approval. With so much activity within the industry, stakeholders are encouraged to stay informed and vigilant.
What to Watch
In the cryptocurrency space, various dates are noteworthy:
- April 5: The purported birthday of Satoshi Nakamoto.
- April 7, 7:30 p.m.: Syscoin (SYS) will activate the Nexus upgrade on its mainnet.
- April 9, 10:00 a.m.: A U.S. House Financial Services Committee hearing will address updates to U.S. securities laws concerning digital assets.
- April 17: EigenLayer (EIGEN) will implement slashing penalties for operator misconduct on the Ethereum mainnet.
- April 21: Pending approval, Coinbase Derivatives will list XRP futures.
Macro Events
- April 4: Release of the U.S. Bureau of Labor Statistics’ March employment data.
- April 4: Statistics Canada releases its March employment data.
- April 4: Fed Chair Jerome H. Powell will deliver a speech on the economic outlook.
- April 5: The Trump administration’s 10% baseline tariff on imports goes into effect.
- April 9: Higher tariffs on imports from trade-deficit countries take effect.
Token Events
Numerous governance votes and calls within various DAOs are scheduled, signaling ongoing community engagement:
- Sky DAO is voting on an executive proposal set to conclude on May 3.
- AaveDAO discusses upgrades to GHO Savings to enhance multichain integration.
- April 4: Core DAO will host an Ask Me Anything (AMA) session.
Market Movements
Recent market performance shows:
- BTC is currently priced at $83,032.61, marking a slight increase from yesterday.
- ETH is at $1,795.41, also reflecting slight growth.
In conclusion, while tariff tensions may have caused immediate fluctuations within cryptocurrency markets, advancing toward clarity could open pathways for renewed optimism and growth in the coming weeks. Stakeholders within the crypto space should prepare for a dynamic environment marked by both challenges and opportunities.
Stay tuned for upcoming developments as they unfold!
