PANews March 10 news, according to Bloomberg, on Monday, cryptocurrency prices continued to fall, and escalating tariff war tensions and weakening expectations of further interest rate cuts by the Federal Reserve offset the positive impact of a series of statements by US President Donald Trump last week in support of cryptocurrencies. Risk assets such as cryptocurrencies have been under pressure since the Federal Reserve hinted at a pause in interest rate cuts in mid-December last year. Last Friday's employment data showed that the US unemployment rate rose from 4% to 4.1%, further exacerbating market uncertainty. Augustine Fan, partner at SignalPlus, a cryptocurrency derivatives software provider, said: "The surge in the 'underemployment' rate to a five-year high has heightened concerns about a recession and pushed yields lower as expectations of rate cuts are brought forward to early summer."
Trump’s friendly stance toward cryptocurrencies, including the signing of an executive order to establish a U.S. Bitcoin reserve and a separate reserve of other tokens, as well as a high-profile summit with industry executives in Washington, did limited work to boost sentiment. While the government pledged to fund the reserve with cryptocurrencies seized through legal proceedings, the lack of new capital commitments disappointed investors. “The market viewed the summit as disappointing, and major cryptocurrencies fell after the widely anticipated news that the cryptocurrency reserve would only hold existing government assets,” said Jeff Mei, chief operating officer of crypto exchange BTSE. “Bitcoin is likely to fall to the $70,000-80,000 range in the coming weeks. Only when this tariff war ends and the Fed resumes rate cuts will major cryptocurrencies re-enter their previous all-time highs,” Mei added.
The United States currently owns about $17 billion in Bitcoin and about $400 million in several other tokens, largely due to asset forfeitures related to civil and criminal cases. Ari Paul, co-founder of BlockTower Capital, said that given recent developments such as the weakening of the SEC's enforcement efforts, it is reasonable for investors to be more optimistic about cryptocurrencies, but other factors are more subtle and even negative. Paul said in a message: "The government's apparent capriciousness and partiality in choosing strategic reserve assets - especially after the launch of Trump and Melania tokens - is a strong deterrent for investors. This gives the impression that the Trump administration is selecting and promoting 'insider' assets based on lobbying, and today's cryptocurrency market is largely a casino for short-term trading."
