TL;DR
- The crypto market continues to suffer, with widespread declines driven by trade tensions and expectations that the Fed will not cut interest rates further in the short term.
- Trump’s announcements about a Bitcoin reserve failed to excite investors, as the measure did not include new capital or significant changes.
- The price of Bitcoin has fallen 25% from its all-time high, trading near $80,000, while other cryptocurrencies like Ethereum and Solana are also facing significant declines.
The crypto market continues to face difficulties amid macroeconomic chaos. On Monday, the prices of nearly all cryptocurrencies continued to fall, mainly influenced by trade tensions and expectations that the U.S. Federal Reserve will not cut interest rates further in the short term. These factors put significant pressure on risk assets, which were already affected by the Fed’s recent decisions.
Despite a series of favorable announcements from President Donald Trump, the market’s reaction has been underwhelming. The U.S. president signed an executive order aimed at establishing a Bitcoin reserve in the country and an inventory of other tokens, with the goal of strengthening its power in the crypto market. However, investors did not respond positively to these measures, as the administration did not commit new capital or make announcements that could alter the current market situation.
Investors Don’t Respond and the Crypto Market Falls
Additionally, Trump’s summit with crypto industry executives did not manage to lift investors’ spirits. The proposal for a cryptocurrency reserve turned out to be less impactful than anticipated. The reserve will be limited to assets already in the government’s possession, which disappointed investors who were expecting new investments or a greater push.
Macroeconomic issues have also played a crucial role in the price decline. Recent U.S. employment data showed an increase in the unemployment rate, which has raised fears of a recession. Additionally, there is a lack of monetary stimulus, which has reduced recovery prospects for the crypto market in the short term. Despite decreased regulatory pressure from the U.S. Securities and Exchange Commission (SEC), uncertainty remains a constant issue.
Everything in Red
The price of Bitcoin, which has already fallen 25% from its all-time high, could face a further correction in the coming weeks. It is currently trading just under $80,000, reflecting a 4.5% intraday drop. However, some analysts estimate it could fall to $70,000. The bearish trend in the market may only reverse when the trade war calms down and the Fed begins to lower rates again.
As for the rest of the market, Ethereum is trading at $2,010.56, showing a drop of 3.66%. BNB is at $546.27, down 3.42%. Cardano is at $0.694425, registering a 7.57% drop. XRP is trading at $2.10, down 2.78%. Dogecoin is at $0.164699, with a decrease of 5.72%. Solana is trading at $121.07, showing a 7.56% drop. Polkadot is at $4.04, with a decline of 2.42%. Litecoin is at $91.56, recording a decrease of 7.55%. Chainlink is at $13.32, with a drop of 5.87%. Polygon is trading at $0.218794, showing a decrease of 5.21%.
