Market Shrugs Off Trump Tariffs With $2 Billion Crypto Inflows

Market Shrugs Off Trump Tariffs With $2 Billion Crypto Inflows

  • 5 hours ago
  • beincrypto.com
  • Keywords: High Tariffs, Market Volatility

Crypto inflows reached $2 billion last week, marking three straight weeks of gains totaling $5.5 billion. Bitcoin led with $1.8 billion in inflows, while Ethereum gained $149 million. Despite Trump’s tariffs and GDP slowdown, market sentiment remains strong due to positive economic data and institutional interest.

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Context

Analysis: Market Insights and Implications

Overview

  • Crypto Inflows: Last week saw $2 billion in crypto inflows, extending a streak of three straight weeks with total inflows reaching $5.5 billion.
  • Bitcoin Dominance: Bitcoin led with $1.8 billion in inflows, while Ethereum gained $149 million.

Market Sentiment and Drivers

  • Positive Economic Signals: Strong jobs data (177k vs. 135k expected) boosted market sentiment despite a GDP slowdown of -0.3%.
  • Institutional Interest: Institutional investors are showing renewed interest in digital assets, driven by macroeconomic factors.

Macroeconomic Context

  • GDP Performance:
    • Headline GDP: Fell 0.3%, impacted by export declines due to US tariffs.
    • Core GDP: Rose 3.0%, reflecting private sector strength.
  • Employment Data: Strong payrolls reduced the likelihood of an FOMC rate cut, with markets expecting only 86 basis points (bps) of rate cuts in 2025.

Regulatory and Market Dynamics

  • Consumer Behavior: Services inflation shows weakness, suggesting cautious consumer behavior.
  • Regulatory Concerns: Investors cite regulatory risks as their top concern, highlighting a disconnect between perceived risk and market behavior.

Long-Term Implications

  • Bitcoin Momentum: Bitcoin's momentum remains positive in the US, with its haven status attracting investors amid economic uncertainty.
  • Digital Asset Growth: The sustained inflow into crypto investment products suggests long-term growth potential for digital assets.

Key Metrics

  • Bitcoin Price: Trading at $93,997 as of the latest update, down by almost 2% in the last 24 hours.
  • Inflows Breakdown:
    • Bitcoin: $1.8 billion
    • Ethereum: $149 million
    • Other Assets: Minor inflows of $6 million

Strategic Considerations

  • Business Preemption: Businesses may be preempting tariffs, potentially influencing supply chain and investment strategies.
  • Market Expectations: Markets anticipate rate cuts, but strong employment data suggests cautious optimism.

Conclusion

The sustained crypto inflows and positive market sentiment indicate resilience in the digital asset sector despite macroeconomic headwinds. However, regulatory risks remain a key concern for investors.