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Tariffs, Fed moves, and crypto: Navigating a volatile March 2025

Tariffs, Fed moves, and crypto: Navigating a volatile March 2025

As I unpack the current state of the cryptocurrency market, particularly with Bitcoin edging higher to US$84,000 and analysts issuing warnings of potential downturns, it’s clear that we’re navigating a fascinating yet turbulent moment in financial history.

The crypto markets rose modestly alongside US equities on Monday, with the CoinDesk 20 index climbing 2.4 per cent over the past 24 hours. Bitcoin, the bellwether of the crypto world, is trading at around US$84,000 as of today, March 18, 2025. This uptick feels like a brief sigh of relief after a rollercoaster ride, but the warnings from analysts like Joel Kruger at LMAX keep me grounded.

Kruger suggests that a sustained correction in US equities could drag Bitcoin back down to its March 2024 peak range of US$73,000 to US$74,000. It’s a sobering thought—while the market is showing some resilience, the broader economic currents could easily pull it under.

Let’s go a bit deeper.

The interplay between crypto and traditional markets has grown increasingly pronounced over the years. Bitcoin’s modest gains this week align with a pickup in global risk sentiment, buoyed by US retail sales data that, while softer than expected on the headline figure, showed strength in control group sales. This suggests a slowdown rather than a full-blown recession, which is music to the ears of investors who’ve been jittery about the health of the US consumer.

The MSCI US index advanced 0.7 per cent, with sectors like Real Estate and Energy leading the charge. Meanwhile, the yield on the 10-year US Treasury note dipped slightly to 4.30 per cent, and the Dollar Index weakened by 0.3 per cent. These are subtle shifts, but they paint a picture of a market that’s cautiously optimistic, yet still bracing for what the Federal Reserve might do next.

Markets fully expect the Fed to hold interest rates steady this week, and there’s chatter that policymakers might even pause the balance sheet runoff—a move that could inject some liquidity back into the system and potentially support risk assets like Bitcoin.

But here’s where I start to feel a bit uneasy. Even with these positive signals, the crypto market isn’t out of the woods. Kruger’s warning about a potential leg down for Bitcoin isn’t just idle speculation—it’s rooted in the historical correlation between equities and crypto during periods of uncertainty.

If US stocks falter, Bitcoin could lose its footing, retreating to that US$73,000-US$74,000 range. And it’s not just Bitcoin feeling the heat. Ethereum, the second-largest cryptocurrency by market cap, is facing its own challenges. Standard Chartered recently slashed its 2025 price target for Ether by a whopping 60 per cent, dropping it from US$10,000 to US$4,000.

That’s a dramatic revision, and it reflects a growing skepticism about Ethereum’s near-term prospects. As of March 15, Ether was trading at US$1,937.39—well below its late 2021 peak of US$4,400. Compare that to its heyday when a digital art piece sold for 38,000 ETH (equivalent to US$69.3 million) as the world’s most expensive NFT, and you can see how far the mood has shifted.

Ethereum’s price history offers some context here. Back in 2021, it rode a wave of excitement fuelled by technological advancements like the Berlin update and the anticipation of the Ethereum Merge, which eventually rolled out in 2022. These upgrades promised lower transaction fees (or “gas prices”) and a shift to a more energy-efficient proof-of-stake system, sparking a rally that set it apart from Bitcoin’s Coinbase-IPO-driven surge.

But the collapse of FTX in late 2022 was a gut punch to the entire crypto ecosystem, and Ethereum wasn’t spared. Its ties to Decentralised Finance (DeFi)—the blockchain-based financial ecosystem that it powers—mean its fate is intertwined with the health of that sector.

DeFi has been a game-changer, cutting out intermediaries with tools like Uniswap, Maker, and Compound, but it’s also been a volatile space prone to hype and crashes. If DeFi struggles, Ethereum feels the ripple effects, and right now, the US$4,000 price target from Standard Chartered suggests a lack of confidence in a robust recovery anytime soon.

Shifting gears to the broader economic landscape, there’s a lot to unpack. Global risk sentiment is picking up, and that’s partly thanks to US retail sales data easing fears of a consumer collapse. Gold is testing the US$3,000 per ounce mark, though it pulled back slightly after the OECD downgraded its global growth forecasts, citing the impact of looming US tariffs under President Trump.

Speaking of which, Trump’s reminder that broad reciprocal tariffs—and additional sector-specific ones—will kick in on April 2, 2025, is keeping markets on edge. Brent crude oil settled at US$71 per barrel amid supply disruption risks in Yemen, adding another layer of geopolitical tension to the mix.

Over in Asia, China’s economic data for January and February 2025 beat expectations, with industrial production, retail sales, and urban fixed asset investment all showing strength. The People’s Bank of China (PBOC) is also rolling out measures to boost consumption, which could bolster their aggressive five per cent GDP growth target for the year. These developments suggest a two-speed global economy—one where Asia might be finding its footing while the US grapples with tariff uncertainty.

Back to crypto, there’s more news stirring the pot. South Korea’s central bank has ruled out holding Bitcoin as a reserve asset, a decision that dashes hopes of institutional adoption in that corner of the world. Meanwhile, the US Securities and Exchange Commission (SEC) is in flux—acting Chair Mark Uyeda has directed staff to reconsider a proposed crypto rule change for the second time this month. It’s unclear what this means for the regulatory landscape, but it signals ongoing uncertainty that could keep investors cautious.

For me, this all adds up to a market that’s caught in a tug-of-war between optimism and caution. Bitcoin at US$84,000 feels like a tentative step forward, but the warnings of a pullback to US$73,000-US$74,000 loom large. Ethereum’s struggles, underscored by Standard Chartered’s bearish outlook, highlight the unique challenges facing altcoins in this environment.

I think we’re in a holding pattern. Bitcoin’s current bounce is encouraging, and the alignment with US equities suggests it’s still got some wind in its sails. But Kruger’s caution about a potential correction tied to stock market weakness feels all too plausible—especially with Trump’s tariffs on the horizon and the Fed’s next moves still up in the air.

Ethereum, meanwhile, is at a crossroads. Its price might not plummet to 2022 lows, but the US$4,000 target for 2025 reflects a market that’s lost some of its earlier fervor. DeFi could be the wildcard—if it regains momentum, Ethereum might surprise us yet.

“For now, though, I’d approach both Bitcoin and Ether with a mix of hope and skepticism. The data tells me there’s room for growth, but the risks—economic, regulatory, and geopolitical—are impossible to ignore.”– Anndy Lian

I’ll keep digging into the numbers and the narratives, because in a market this dynamic, the story’s far from over.

—

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic.

 

Source: https://e27.co/tariffs-fed-moves-and-crypto-navigating-a-volatile-march-2025-20250318/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

The new norm: Stabilising global risk sentiment in a volatile market

The new norm: Stabilising global risk sentiment in a volatile market

February 6, 2025: We’ve recently witnessed a stabilisation of risk sentiment following a tumultuous week marked by volatile price action. Despite the tech sector’s underwhelming earnings, the MSCI US index managed to eke out a modest gain of 0.4 per cent, buoyed by a broader rally across other sectors. This resilience in the face of disappointing tech earnings speaks volumes about the current market dynamics, where diversification across sectors seems to be paying dividends.

The week’s economic data provided a mixed bag of signals. The US ISM services data, which fell unexpectedly to 52.8 against a consensus forecast of 54.1, sent ripples through the financial markets. This decline in service sector activity led to a significant drop in US Treasury (UST) yields, with the 2-year yield softening by three basis points to 4.19 per cent and the 10-year yield dropping eight basis points to 4.42 per cent.

This adjustment in yields reflects a cautious optimism among investors, perhaps taking some comfort in the narrowing of the 10s2s yield curve, which tightened by another 6 basis points to 23 basis points. This movement in the yield curve suggests that while the market anticipates no immediate rate hikes, the long-term outlook might be less hawkish than previously thought.

Amidst this backdrop, the voices from the Federal Reserve, including Jefferson, Barkin, and Goolsbee, maintained a steady drumbeat of “no rush on rate cuts,” although Goolsbee struck a surprisingly hawkish tone, cautioning about inflation risks stemming from potential tariffs.

This nuanced shift in narrative was further complicated by comments from Treasury Secretary Scott Bessent, who indicated that the Trump administration’s focus on reducing borrowing costs would target the 10-year Treasury yields rather than the Fed’s short-term rates. This policy direction could have profound implications for long-term investment strategies and the broader economic landscape.

The US Dollar Index, reflecting these shifts in economic policy and investor sentiment, fell by 0.4 per cent, reaching its lowest point in over a week. This decline was partly due to receding fears of a global trade war, which also influenced currency pairs like USD/JPY, dropping from 154.50 to 152.50 after Japan reported stronger-than-expected wage growth, sparking speculation of another Bank of Japan rate hike.

Gold, often seen as a safe-haven asset, continued its bull run, climbing to a new high of US$2,865 per ounce. This surge was fuelled not only by the general risk-off sentiment but also by fears that higher tariffs might extend to precious metals and commodities imports from the UK and the European Union.

Conversely, Brent crude oil prices fell by 2.1 per cent after an EIA report highlighted an increase in crude oil inventories, adding to the overhang of geopolitical risks in the oil market.

Looking at the equity front, Asian markets took their cues from Wall Street, opening higher, while US equity futures suggested a positive start for American stocks, indicating a potential continuation of the stabilisation trend.

The week wasn’t just about traditional markets; significant strides were made in the digital asset space. White House Crypto Czar David Sacks announced that the first priority for the administration would be stablecoin legislation. This move comes at a time when stablecoins, despite their popularity mainly overseas, have yet to find a clear regulatory path in the US The establishment of a Crypto Task Force, with SEC Commissioner Hester Peirce at the helm, aims to carve out a regulatory framework that balances innovation with investor protection.

The task force’s agenda is ambitious but necessary. It seeks to eliminate the regulatory ambiguity that has long plagued the crypto industry, where businesses operate under the shadow of potential legal repercussions without clear guidelines. Commissioner Peirce emphasised in her statement that the SEC’s initiative isn’t an endorsement of any crypto asset but rather an effort to provide a regulatory environment that makes sense for crypto while safeguarding investors from fraudulent schemes. The focus on stablecoins is particularly pertinent, given their role in providing liquidity and stability within the volatile crypto market.

This regulatory push could potentially be legislated within six months, according to Sacks, which is a bold timeline considering the complexities involved. Yet, it signals a significant shift towards integrating cryptocurrencies into the mainstream financial system, recognising their potential while addressing the inherent risks.

In conclusion, this week’s market movements reflect a broader narrative of stabilisation amidst volatility, driven by economic data, policy signals, and geopolitical developments. The focus on stablecoin regulation could be a game-changer for the crypto market, potentially fostering an environment where digital assets can thrive under a clearer legal framework.

However, the journey towards such stability in both traditional and digital markets is fraught with challenges, requiring a delicate balance between fostering innovation and ensuring economic and financial integrity. As we move forward, the interplay between market sentiment, regulatory actions, and global economic policies will continue to shape our financial landscape in unpredictable but potentially rewarding ways.

 

Source: https://e27.co/the-new-norm-stabilising-global-risk-sentiment-in-a-volatile-market-20250206/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j