The Trump Tariffs, And a New Marginal BTC Buyer? Interesting Weeks Ahead

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This Week’s Top Stories

“Trump’s Tariffs Are Inching Closer: He Announces a 25 Percent Tariff on All Cars Imported into the U.S., and More” – This Week

• The ongoing story surrounding President Trump and his tariffs has seen its ups and downs this week. On Wednesday, Barclays analysts indicated that they expect Trump to announce reciprocal tariffs next week on 15 to 25 countries, likely affecting the auto, pharmaceutical, and semiconductor sectors.
• On Wednesday, Trump announced a 25 percent tariff on all cars imported into the U.S. This announcement sent the stocks of General Motors, Ford, and Stellantis lower, while German and Asian automakers also took a hit, trading to the downside. Elon Musk commented on the auto tariffs, stating that they would have a significant impact on Tesla.
• World leaders from Canada, Germany, Japan, China, and other countries have condemned the tariffs and are planning retaliatory actions, though no concrete measures have been announced yet. They are likely waiting to see how the situation unfolds next week, as the tariffs are set to take effect on April 3.
• The market is anticipating Donald Trump’s promised “U.S. Liberation Day” on April 2, when he is set to announce all the reciprocal tariffs. While this story has been developing for weeks, its tone has shifted multiple times. The big question remains: Will Trump follow through, and what is the market expecting?

“China’s Xi: To Invest in China Is to Invest in Tomorrow." – Friday, 28 March 2025

• Today, China’s President Xi Jinping met with top executives from Saudi Aramco, Blackstone, Standard Chartered, Pfizer, Bridgewater Associates, and others to discuss investment opportunities in China to attract foreign investment amid this week’s escalation in the tariff saga. More than 40 executives attended the meeting, which took place four days after the China Development Forum – an annual event that Apple’s Tim Cook also attended this week.
• Foreign investment in China has declined significantly over the past several years. However, Xi emphasized that China would remain a top destination for foreign investors and that the country’s doors will continue to open wider to the world in terms of investment opportunities.

“GameStop is Closing Stores and Wants to Buy Bitcoin à la Michael Saylor.” – Wednesday, 26 March 2025

• GameStop has announced that it will follow Saylor’s strategy and plans to privately offer $1.3 billion in 0.00 percent Convertible Senior Notes. The company intends to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin.
• GameStop also revealed that it expects to continue its spree of store closures over the coming months. Currently, there are around 3'200 GameStop locations, down from over 6'000 less than ten years ago.
• GME, GameStop's stock, initially surged after the announcement on Wednesday but has since reversed its breakout and is now trading even lower than before the announcement, down more than 25 percent from this week’s high.

A Quick Crypto Overview: Everyone is Waiting for a Clear Narrative

The crypto market remains in a phase of consolidation, lacking a clear trend or narrative. Bitcoin and the broader market traded higher at the start of the week, with BTC rising from $83’000 to $88’000 over the course of Sunday and Monday. However, it then started trading lower again. This week has lacked a clear direction, as Bitcoin has been ranging between $87’000 and $85’000 throughout.

Most major cryptocurrencies are following a similar pattern, with some exceptions driven by specific news, such as upgrades or new product releases. For example, Berachain has surged more than 20 percent since Monday, following the launch of its Proof-of-Liquidity mechanism.

Overall, the crypto market continues to move in tandem with the U.S. stock market, as both remain in a state of uncertainty ahead of Trump’s tariff decision next week. The chart below reflects this market indecision and highlights ETH’s continued underperformance, with Ether down over 4 percent today at the time of writing.

While U.S. stocks and the crypto markets are characterized by uncertainty, this uncertainty is also reflected in the gold chart, being up more than 2 percent this week – reaching a new all-time high above $3’070 per ounce.

Chart of the Week: Price Drawdowns from ATH, BTC and BNB Holding up Well

This week, we are examining the top five cryptocurrencies (excluding stablecoins) based on their current percentage drawdown from their all-time highs.

Bitcoin is currently down about 20 percent from its January all-time high, and the only altcoin in the top five holding up similarly is BNB, down 21 percent – almost on par with Bitcoin. XRP follows in third place, down nearly 40 percent from its all-time high, while SOL has declined 53 percent, and ETH is trading 58 percent below its 2021 peak.

This chart once again highlights the challenges most altcoins faced during the last cycle, with Bitcoin absorbing much of the capital flowing into the industry. Only select altcoins managed to keep pace with the king of crypto, and even Solana, which tracked Bitcoin closely for most of the cycle, is now down more than 50 percent from its recent all-time high.

What’s Happening On-Chain? Hyperliquid Drama, dYdX Buybacks and More

On Wednesday, the derivatives exchange Hyperliquid made headlines again after its automated market maker vault (HLP) was forced into a large short position on a low-market-cap altcoin ($JELLY). This occurred after a trader self-liquidated his short position by removing the necessary collateral to maintain it, forcing the HLP vault to take over.

At the same time, another wallet began aggressively buying $JELLY on the on-chain spot market, attempting to artificially inflate its value. This caused the market cap to surge from $10 million to $50 million in under an hour. Binance and OKX then fueled the situation further by listing JELLY futures, triggering a sharp rally in the token’s spot price. As a result, the Hyperliquid vault faced an unrealized loss of up to $13 million at its peak.

Hyperliquid’s HLP vault was at risk of losing significantly more if the attackers had pushed $JELLY's price even higher. As the situation escalated, Hyperliquid validators voted to:

1. Delist $JELLY perpetual contracts,
2. Adjust the $JELLY oracle price to $0.0095, and
3. Forcibly close all positions, despite the market price being $0.50 at the time.

Hyperliquid also announced that all users, except for some flagged addresses, would be made whole by the Hyper Foundation.

The incident has sparked mixed reactions across the industry. Some criticized Binance and OKX for intensifying an already volatile situation, while others questioned Hyperliquid’s decentralization, a topic frequently debated in the past. ZachXBT raised concerns, tweeting that while Hyperliquid previously claimed powerlessness during the Radiant hack incident, it intervened aggressively in this case. He argued that the platform must choose between two approaches: either remain consistent and intervene when necessary or fully decentralize and avoid intervention altogether.

In other news, Polymarket announced that starting this week, users can deposit assets into their Polymarket wallets via the Solana blockchain.

Meanwhile, dYdX has launched its first-ever $DYDX buyback program to reinforce long-term confidence in the token. Beginning this week, dYdX will allocate 25 percent of net protocol fees to buy back $DYDX from the open market and stake them to enhance network security. In 2024, the protocol generated $270 billion in trading volume and $46 million in net protocol fees – meaning that total buybacks for 2024 would have amounted to a little over $1 million.

Since its inception, nearly 9 million tokens have been launched on Pump.Fun, generating over $600 million in total revenue. Interestingly, only four of these tokens – FART, PNUT, ACT, and WOULD – have maintained a market capitalization above $100 million. The total market capitalization of all tokens ever created on Pump.Fun currently stands at $3.3 billion, which is only 5.5 times Pump.Fun’s total revenue since its inception. The chart below shows the total tokens created per day since last August.

Digital Asset Fund Flows: At Last, The Turnaround: Weekly Inflows of $600 Million

Last week, digital asset investment products finally managed to end their streak of net outflows by bringing in $644 million in inflows. Bitcoin continues to attract the bulk of the flows, with $734 million in net inflows while Ethereum experienced net outflows of $86 million last week. While the flows were in the positive again last week for bitcoin, the month-to-date figures are still looking grim, with net outflows for bitcoin continuing to stay above $1 billion so far, XRP currently saw total net outflows of almost $550 million this month and Ethereum almost $400 million, as the table below shows.

In other news, the total value locked (TVL) in the Real-World Assets (RWAs) category, in products and protocols such as BlackRock’s BUIDL, Ethena and Ondo Finance has been continuously hitting new highs, recently surpassing the magic mark of $10 billion for the first time.

IPOs and M&As continue to be a hot topic in the current crypto market cycle. This week, news broke that Coinbase is in advanced talks to acquire Deribit, the world’s largest platform for Bitcoin and Ether options trading. Coinbase and Deribit have reportedly notified regulators in Dubai about the deal discussions, as Deribit holds a license there.

Additionally, Kraken is reportedly working with Goldman Sachs and JPMorgan on a potential debt raise of up to $1 billion to support its expansion efforts. The company is also considering an equity raise and is preparing for a potential IPO as early as Q1 next year. Meanwhile, eToro, another crypto exchange, filed for an IPO with the SEC this week, aiming to raise up to $400 million at a valuation of approximately $4.5 billion.

Looking back over the past 1.5 to 2 years, crypto stocks – particularly COIN – have performed exceptionally well, even compared to major cryptocurrencies like BTC and ETH, with COIN significantly outperforming since the market bottom in late 2022. Future IPOs of crypto companies such as Circle, Kraken, and others remain of high interest to both crypto-native and traditional investors.

Market Sentiment: Uncertainty & Fear in the Markets

As mentioned above, the markets are currently driven by uncertainty and fear, with participants eagerly awaiting next week, when Trump is expected to provide clarity on his tariff actions.

The CNN Stock Market Fear & Greed Index is deep in fear territory at 28, while the crypto market is also in fear but slightly less so, at 44. Interestingly, sentiment among AAII members has improved slightly since last week. The percentage of members bullish on the stock market over the next six months rose from 21 percent to 27 percent, though the majority (52 percent) remain bearish.

Next week’s tariff-related news is expected to be a major market catalyst, likely pushing both sentiment and prices – either toward a recovery to the upside or a steep decline into despair.

Other Relevant News

• Fidelity has filed with the U.S. SEC to register a blockchain-based tokenized U.S. dollar money market fund, initially built on Ethereum with potential expansion to other blockchains. – Link

• Strategy purchased 6’911 BTC at an average price of $84’529, for a total cost of $584.1 million. – Link

• ZachXBT pointed out that Token 2049 has a large number of sponsors that may have malicious behavior. – Link

• BlackRock debuts Bitcoin exchange-traded product in Europe. – Link

• eToro files for IPO. – Link

• Wyoming Governor expects state to issue its own stablecoin by July. – Link

• French state-owned investment bank Bpifrance announced plans to launch a new fund of up to €25 million to directly invest in locally issued cryptocurrencies. – Link

• According to official registration documents, Fidelity officially registered the “Fidelity Solana Fund” in Delaware on March 20. – Link

• Interactive Brokers announced that it has added trading services for Solana (SOL), Cardano (ADA), Ripple (XRP) and Dogecoin (DOGE) to its trading platform. – Link

Looking Ahead: All Eyes on Trump

We’ve had our eyes on Trump for a while now, and it’s starting to feel exhausting that the entire market seems so dependent on one person and his administration. But it is what it is, and we continue to trade what we’re given. “Liberation Day” is inching closer, and the market is closely watching any developments in this regard.

It’s unclear how much of the tariff news is already priced into the market, as there is still a lot of uncertainty about the extent to which the tariffs will be implemented – or whether Trump might back off entirely. No one really knows, and investors seem to be trying to protect their capital in case of a negative shock next week. It wouldn’t be surprising if the market continues to trade lower over the weekend and into Tuesday, but only time will tell.

Next week, all eyes will be on Trump and the news surrounding the tariffs. Perhaps once this is all over, the crypto market will be able to breathe a little and find its own narrative for a while. The question is: What could that narrative be, or will we continue to follow traditional markets for a little while longer?

A new marginal buyer for BTC has appeared on the horizon with GameStop, and the next round of 13F filings will start next week and run until mid-May. These 13F filings could bring some surprises, revealing which institutions have bought or sold BTC ETFs during the first quarter of 2025. Did the institutions buy the dip?

Below, you can find some of the key data releases and events to watch out for next week.

Monday, 31 March 2025

• Japan – Unemployment Rate

Tuesday, 1 April 2025

• Eurozone – CPI, Core CPI, Unemployment Rate

Wednesday, 2 April 2025

• U.S. – Trump’s “Liberation Day” and announcements of tariffs

Thursday, 3 April 2025

• Switzerland – CPI
• U.S. – Initial Jobless Claims
• Eurozone – PPI

Friday, 4 April 2025

• Switzerland – Unemployment Rate
• U.S. – Unemployment Rate, Nonfarm Payrolls, Fed Chair Powell Speaks