The Crypto market went into total panic mode on Tuesday. To be fair, this movement has little to do with the cipher itself. The value is declining as consumer trust is waning due to fear of a trade war.
Bitcoin (Cryptography: BTC) It is the largest headline maker, down 8.2% over the last 24 hours as of 11:45am. Ethereum (Encryption: ETH) Meanwhile, and with Dogecoin it has dropped by 9.2% (Cryptography: Doge) 9.1% off. The decline appears to have been slow, but it is not clear whether there will be a recovery in trading today.
The difficult truth revealed today is that crypto pricing is tied to the economy and is highly correlated with the performance of growth stocks. The crypto market was even higher in the fall of 2024, when investors thought the future would be much brighter, but reality is a bit less bullish.
We learned today that the Consumer Trust Index, maintained by the Conference Committee, a nonprofit think tank, fell from 105.3 in January to 98.3 this month. This is the biggest drop since August 2021, and reading 80 could be a recession. The measure of short-term expectations for the income, business and job market fell 9.3 points to 72.9.
Consumers and investors are partially concerned about tariffs on imports from Canada and Mexico. Mutual tariffs, which reflect tariffs on American goods collected by other countries, are also expected to begin early in April.
The market has not entered the news overall, but growth stocks have fallen sharply.
The current execution at Crypto began in November after the election, with changes to enforcement from the Securities and Exchange Commission, but there was no wholesale of US cryptography that many investors were hoping for. .
In addition, the market is likely to see the value of more blockchain use not coming to native crypto tokens like Bitcoin or Ethereum, and memes like Dogecoin are declining. It may be that you have checked. The ones that get the real utility are stubcoin-like tokens that are cheaper and easier to use than traditional financial tools. And if that’s where blockchain use is going to destroy the financial ecosystem, more pain will come first with many cryptocurrencies.
The momentum that has increased the value of crypto over the past six months has declined, and the US economy appears to be nearing a recession. If that continues, it’s no surprise that cryptocurrencies continue to decline, especially as much leverage in the industry is being washed away.
The story continues