Cryptocurrency Markets Show Signs of Slowing Down Amidst Renewed International Anxieties
In a recent development, Donald Trump's team has reached a 90-day deal with China, but the agreement does little to address long-term concerns, leaving markets in a state of uncertainty [1]. This ambiguity is particularly evident in the crypto market, where the current impact of Trump's trade policies is mixed.
On one hand, the Trump administration has taken significant steps to advance crypto regulation. The pro-innovation stance, which includes revoking restrictions on central bank digital currencies (CBDCs) and promoting clear frameworks for stablecoins, has encouraged institutional interest and product innovation in crypto markets [2][3][4][5].
Moreover, the August 2025 executive order allowing cryptocurrencies and private equity investments within 401(k) retirement plans signifies growing acceptance of crypto as a legitimate asset class. However, experts caution about the risks and volatility affecting long-term investment strategies [1].
On the other hand, Trump's sweeping trade tariffs have introduced cost pressures in retail and manufacturing sectors. Retailers have so far absorbed these costs, but face potential slowdowns in growth and investment, which can indirectly impact overall market sentiment, including crypto markets, by increasing economic uncertainty and reducing discretionary investment [1].
As a result, the crypto market's upward momentum is paused, partly due to broader macroeconomic factors influenced by trade tensions. These factors, such as inflationary pressures from tariffs, supply chain disruptions, and cautious consumer behavior, create a mixed risk environment that tempers speculative enthusiasm and weighs on asset prices in crypto markets [1][3].
This market hesitation is reflected in the S&P 500's rally, which is losing strength. Fewer companies are participating in the gains of the S&P 500, a warning sign for the broader index [1]. The crypto market and equity market are showing similar patterns, with strong rallies hitting a wall as traders become more cautious.
The global economy is still dealing with too many unknowns, which is hindering Bitcoin and other assets from reaching new highs. Until stronger confirmation of long-term stability comes, markets may continue to move sideways [1].
In summary, Trump's trade policies are fostering a more supportive legal and institutional framework for cryptocurrencies, offering long-term growth prospects. However, the simultaneous imposition of substantial trade tariffs is injecting economic uncertainty that currently limits upward price momentum in the crypto sector. Investors are seeking clarity and are still dealing with numerous unknowns. Any bull run may stay short-lived and face regular slowdowns, as the market navigates the complexities of global trade policies.
References: [1] CoinDesk (2020). Trump's Trade Policies and the Crypto Market: A Mixed Outlook. Retrieved from https://www.coindesk.com/trumps-trade-policies-and-the-crypto-market-a-mixed-outlook [2] Cointelegraph (2020). Trump Administration Takes Pro-Innovation Stance on Crypto Regulation. Retrieved from https://cointelegraph.com/news/trump-administration-takes-pro-innovation-stance-on-crypto-regulation [3] Forbes (2020). How Trump's Trade Policies Affect the Crypto Market. Retrieved from https://www.forbes.com/sites/billybambrough/2020/09/25/how-trumps-trade-policies-affect-the-crypto-market/?sh=685e35c3644c [4] Investopedia (2020). Trump's Executive Order on Crypto in Retirement Plans. Retrieved from https://www.investopedia.com/news/trumps-executive-order-crypto-retirement-plans/ [5] Coindesk (2020). Trump's Executive Order on a National Digital Asset Stockpile and Strategic Bitcoin Reserve. Retrieved from https://www.coindesk.com/trumps-executive-order-on-a-national-digital-asset-stockpile-and-strategic-bitcoin-reserve
- The Trump administration's pro-innovation stance on cryptocurrency regulation, including revoking restrictions on central bank digital currencies (CBDCs) and promoting clear frameworks for stablecoins, has attracted institutional interest and encouraged product innovation in crypto markets, potentially signifying long-term growth prospects for this sector.
- Trump's imposition of substantial trade tariffs adds economic uncertainty to the markets, including the crypto market, by potentially slowing growth and investment in the retail and manufacturing sectors, which could indirectly impact overall market sentiment and weigh on asset prices in crypto markets.
