On March 20th, Chloe, a columnist for HTX DeepThink and a researcher at HTX Research, analyzed that the current logic of macroeconomic variables affecting the crypto market has shifted from "easing expectations driving risk appetite" to the dual pressure of "prolonged high interest rates + energy shocks increasing tail risks of inflation." While the Federal Reserve maintained its median forecast of one rate cut this year, Powell's core message was very clear: further rate cuts should not be expected unless inflation shows a substantial decline. Short-term US Treasury yields subsequently rose, indicating that the market is correcting its overly optimistic expectations of rate cuts. For the crypto market, high-beta Altcoin, AI concept coins, and purely narrative-driven assets will be more vulnerable to shocks.
Meanwhile, the situation in the Middle East has pushed up oil prices, reigniting the risk of "double-dip inflation." While the Bank of Japan held rates steady, its future direction for interest rate hikes remains unchanged. Two key variables to watch in the coming weeks are whether US inflation and employment data reinforce expectations of "high interest rates for longer," and whether the Bank of Japan signals an interest rate hike around April. If both factors converge in a hawkish manner, the crypto market will likely remain in a phase of "high volatility, heavy structure, and light beta."
From a market observation perspective, the current environment may be more favorable for defensive investment strategies. BTC, with its liquidity, market consensus, and some safe-haven attributes amidst macroeconomic uncertainty, deserves attention for its relative performance. ETH's performance depends more on on-chain activity, ETF funding, and the recovery of risk appetite. Meanwhile, most Altcoin face some valuation compression pressure. Overall, the market is shifting from "expectations of easing" to "readjusting to a new environment of restrictive interest rates and geopolitical shocks." The short-term main theme may not be a comprehensive expansion of risk, but rather a repricing window awaiting a clearer macroeconomic path.
