Americas Crypto Daybook: Bitcoin's Gains Reversed Amid Escalating Trade Tensions with China

By Omkar Godbole (All times are in ET unless specified otherwise) The leading cryptocurrencies saw their early gains erased after China intensified trade tensions by announcing retaliatory tariffs, following President Donald Trump's decision to impose additional tariffs on China and other nations on Wednesday. Bitcoin's price dropped from $84,600 to $83,000, but the decline appears to be limited, possibly because the market's worst fears have finally been realized. Markets tend to dislike uncertainty, and the anticipation of a potential threat often creates more anxiety than the actual threat itself. Since Trump took office on January 20, markets have been grappling with the threat of tariffs and a global trade war, which has dampened investor risk appetite and caused the BTC price to plummet from a record high of over $109,000 to below $80,000 last month. This week, Trump announced sweeping tariffs on 180 nations, with higher levies on China, the European Union, and Southeast Asia. The effective US tariff rate is now above the level set by the 1930s Smoot-Hawley Tariff Act, which was around 20%. This moment, often referred to as 'tariffageddon,' marks the end of lingering uncertainty and could have a liberating effect on markets, mainly because bond yields have dropped across the advanced world, pricing in disinflation. This is contrary to the popular narrative that tariffs would lead to stagflation – a combination of high inflation and low growth – forcing the Fed to keep interest rates elevated. The yield on the benchmark US 10-year bond has dropped below 4% for the first time since October, and yields have fallen sharply in the UK, Germany, and Japan. Additionally, oil prices have declined sharply this week due to prospects of higher supply from OPEC countries. All these developments bode well for Fed rate cut bets and risk assets, including cryptocurrencies. The same can be said for Friday's March jobs report, which, if it beats estimates, will likely be seen as backward-looking and failing to account for this week's Trump tariffs, while a weak print will only add to Fed rate cuts. With the major macro uncertainty behind us, the crypto market could return to focusing on positive developments, such as the USDC issuer Circle's IPO filing and technological advancements. On Thursday, Coinbase Derivatives submitted documentation to the CFTC to self-certify futures for XRP. Furthermore, Ethereum developers have chosen May 7 as the date for the Pectra upgrade to go live on the mainnet. Elsewhere, the SEC has acknowledged Fidelity's filing for a spot exchange-traded fund tied to SOL, which brings it closer to approval. A lot is happening within the industry, so it's essential to stay alert. Key Events to Watch Token Events Conferences Token Talk By Shaurya Malwa Derivatives Positioning Market Movements Bitcoin Statistics: Technical Analysis Crypto Equities ETF Flows Spot BTC ETFs: Spot ETH ETFs Source: Farside Investors Overnight Flows Chart of the Day While You Were Sleeping In the Ether