Today, Trump started his day with a threatening tone, leading to increased volatility in cryptocurrencies over the past hour. The situation is becoming progressively complex, with tariff agreements making little headway since January. Besides an agreement in the UK and a consensus with Vietnam, there is nothing significant to note. This indeed poses an important problem.
Trump: I Am Stirring the Markets
A short while ago, Trump made new statements, acknowledging on television that he is aware of agitating the markets. “I am stirring the markets when I appear on TV,” he proclaimed. Though it might sound humorous given how closely we are to days of uncertainty choking the risk markets, investors have grown weary of this ongoing spectacle.
This is precisely why nobody cares about tariff rates anymore. The rates set to take effect on August 1st are generally higher than those announced in April. Described as tougher and more long-term, the markets currently seem unperturbed due to similar narratives over the past seven months. Consequently, cryptocurrencies have ceased pricing in these expectations for the time being.
Will Cryptocurrencies Fall?
In the initial section, we discussed how expectations are no longer factored into pricing. But what if events start getting priced in? It could translate to a further decline for cryptocurrencies. U.S. sources indicated weeks ago that the India agreement would be signed within days. We’ve repeatedly heard that the India deal has concluded, awaiting just the signature, and today we see declarations that the Indian delegation is in the U.S. for negotiations.
The agreements with South Korea and Japan seemed like certainties following the most promising negotiations. Just recently, Trump threatened them with the April rate in a tariff letter. It was mentioned that the European Union favored an agreement, making it unlikely to receive a tariff letter. However, a 30% tariff letter was sent on Saturday, and no agreement is in sight yet.
According to sources, the ECB will be discussing more pessimistic scenarios than anticipated in June following Trump’s recent tariff threat. The European Central Bank (ECB) is hesitant to single-handedly intervene in the tariff impact and will maintain interest rates steady in July.
Who will respond to the tariffs? If no agreement is reached by August 1st, a retaliatory move worth tens of billions of dollars will occur. At that juncture, cryptocurrencies will face reality, setting aside disregarded expectations. When the German Chancellor mentioned the possibility of an agreement by September (since Trump was adamant on July 9th), investors were bewildered. It has become clear that the tariff saga won’t easily conclude, and Trump will continue fluctuating the markets.
Bitcoin 
$77,690 fell to around $119,000 but is now at $120,234, with an all-time high of $123,218.
