Recent US actions in the form of significant tariffs on imports have caused serious fluctuations in global financial markets, including the cryptocurrency sector. The consequences of these tariffs on Bitcoin and the overall market are discussed.
Tariff Tensions
This week, US President Donald Trump imposed significant tariffs on goods from 180 countries, with China, the EU, and Southeast Asia being the hardest hit. US tariffs now exceed the 20% threshold set by the Smoot-Hawley Act of 1930. Many analysts believe this 'tariffageddon' could signal the end of market uncertainty, which could ultimately enhance investor confidence. Following the tariffs, global bond yields have dropped, indicating a potential easing of inflation.
Global Correlation
The crypto community points out that the real issue is not Bitcoin's fundamentals, but the global market correlation, which also drags down cryptocurrency. As markets face broader economic challenges, crypto assets are not immune to volatility. However, once global issues ease, Bitcoin is poised for a quick recovery.
Positive Changes in Crypto Industry
Despite the current challenges, the crypto market is refocusing on promising developments. For example, Circle’s USDC is gearing up for its IPO, and Coinbase Derivatives has filed with the CFTC to self-certify XRP futures. Furthermore, Ethereum's Pectra upgrade is scheduled to launch on May 7. The SEC has also recognized Fidelity's application for a spot ETF linked to SOL, bringing it closer to approval.
Despite the pressures created by new tariffs, the crypto industry is showing promising directions that may positively affect the market in the long run.
