Trump's tariff plan has caused more damage than SEC regulations, pushing prices down to a low of $80,000. However, the situation is now changing. Bitcoin, XRP, and Solana surged early Monday as reports suggested that Trump's upcoming tariffs on April 2 might not be as severe as feared. This change helped improve market sentiment, driving a boom in both stocks and cryptocurrencies.
Bitcoin and Solana Lead the Trend
Following the news, Bitcoin rose 2.7% in 24 hours, trading around $86,500, while Solana (SOL) jumped nearly 6% to $138. XRP also recovered, increasing 2.5% to $2.44, staying above the 50-day moving average after two weeks of price gains. Simultaneously, US stock futures, including S&P 500 and Nasdaq, increased 0.5%, while VIX, Wall Street's fear gauge, dropped 2.5%.
Trump's Tariffs: A Gentler Approach?
Initially, tariff concerns drove the market down, with Bitcoin dropping nearly 17.6% in February. However, recent reports suggest tariffs may be more targeted than initially predicted. Some countries might be exempted, and additional taxes on steel and other metals may not be cumulative. This news has reassured investors, bringing optimism to financial markets.
Federal Reserve and Market Outlook
The Federal Reserve recently updated its outlook, raising inflation predictions but maintaining plans to cut rates twice this year. They also dismissed concerns that tariffs would cause long-term inflation, viewing the impact as temporary. This has boosted confidence in risky investments like Bitcoin.
Could There Be Backlash?
Despite improved sentiment, experts warn that unexpected developments or more aggressive trends from Trump could still affect the market in the coming days. Cryptocurrency expert Peter Schiff criticized Trump's tariff plan as a "Liberation Day", arguing that instead of restoring US wealth, it would expose the country's deep dependence on global productivity and savings.
Important Events to Watch
All eyes are on two crucial events that could shape market sentiment in the coming days. On March 27, the Senate Banking Committee will question SEC nominee Paul Atkins and Currency Director nominee Jonathan Gould, potentially indicating regulatory changes. Meanwhile, Friday's PCE index, the Fed's primary inflation measure, will provide more insight into future monetary policy.
With tariff concerns diminishing and the Fed maintaining a lenient policy, the cryptocurrency market is regaining momentum, suggesting potential for further growth.
