Greetings from Distributed Ledger again. This is BourseWatch’s crypto correspondent, Frances Yue.
This Friday will be the first White House crypto summit hosted by President Donald Trump. It might not be sufficient, though, to boost the price of bitcoin, which has recently suffered as worries about tariffs affect all risky assets, according to some analysts.
After Trump stated that his proposed crypto reserve will comprise not only bitcoin and ether (ETHUSD), but also XRP (XRPUSD), solana (SOLUSD), and cardano (ADAUSD), Bitcoin (BTCUSD) surged past $94,000 last Sunday. But a day later, the biggest cryptocurrency by market value lost all of its gains, plunging below $83,000 on Tuesday. Although it was still more than 17% below its record high of $109,225 on January 20, the day of Trump’s inauguration, it recovered to trade close to $90,000 on Wednesday.
Although many bitcoin bulls believe that the cryptocurrency will eventually be recognized as a store of value asset, it has been moving largely in lockstep with stocks for the previous few days.
According to Alex Tapscott, managing director and portfolio manager at Canadian alternative investment management Ninepoint Partners, investors will need to see market sentiment normalize before bitcoin may potentially restart its ascent. Amid concerns that Trump’s tariff measures could cause inflation to rise, investors have been selling risky assets and looking for safe havens, which could make it more difficult for the Fed to lower its main interest rate this year.
Occasionally, I can envision a situation in which bitcoin is performing exceptionally well while the stock market is flat. “I don’t see a situation where bitcoin is doing well and the stock market is collapsing,” Tapscott stated.
Following Trump’s announcement that he would provide a one-month reprieve from new tariffs on auto imports from Canada and Mexico, U.S. markets ended the day Wednesday significantly higher.
Crypto investors are still awaiting specific legislation, despite their celebration of Trump’s executive order establishing a crypto working group, which is anticipated to suggest a federal regulatory framework controlling the issue and operation of digital assets.
According to Tapscott, if such legislation is passed, it might increase institutional adoption, which could be the true driving force behind the next cryptocurrency surge.
To discuss Trump’s crypto policies, find Frances Yue on X.
The summit on Friday
According to Tapscott, there is little chance that Trump’s crypto meeting on Friday will cause a big move in the price of bitcoin.
In a phone interview, Tapscott stated, “I believe the market will eventually learn to begin discounting presidential proclamations.” “To be honest, I don’t believe that the president of the United States or anybody else should be making major announcements all the time. They should concentrate on the laborious task of developing a framework of policies that will enable the industry to expand and flourish in the United States. I’m not sure if they will make an announcement about that at this meeting.
According to a CoinDesk story, executives from cryptocurrency startups like Coinbase (COIN), Chainlink, and Exodus (EXOD) will be present at the gathering.
According to Tapscott, investors are more interested in possible laws that may encourage more well-known businesses and investors to use cryptocurrencies.
Notably, they are keeping an eye on whether the bipartisan stablecoin bill introduced by Senators Cynthia Lummis of Wyoming, Tim Scott of South Carolina, Kirsten Gillibrand of New York, and Bill Hagerty of Tennessee last month will be passed by Congress. This bill could pave the way for additional financial institutions to issue their own stablecoins.
Cryptocurrencies known as stablecoins are those whose value is based on another item, like commodities or fiat currencies like the US dollar.
Establishing a regulatory framework for stablecoins and their issuers is the goal of the bill. It suggests that the Office of the Comptroller of the Currency would be in charge of nonbank issuers of payment stablecoins, while the Federal Reserve would be in charge of financial institutions that issue stablecoins with a market value of $10 billion or more.
Additionally, cryptocurrency investors hope the SEC will authorize additional cryptocurrency-related exchange-traded products. Notably, they are awaiting word from the agency on whether ETFs that invest in smaller tokens like Solana, XRP, and Cardano will be approved, as well as whether ETFs that hold ether will be able to stake it, locking up the cryptocurrency for a payout. According to Tapscott, they are also keeping an eye on whether the SEC will authorize exchange-traded funds (ETFs) that invest in a variety of cryptocurrency assets. This might enable investors to diversify their cryptocurrency holdings using their conventional brokerage accounts.
Crypto quickly
for the last check on Wednesday, Bitcoin (BTCUSD) was trading for about $90,342, up 8% over the previous seven days. According to Dow Jones Market Data, Ether (ETHUSD) dropped 4.3% to about $2,236 over the last seven days.
