The Trump administration's proposal to lower U.S. drug prices by 30%-80% through executive order: what significant impact will it have on cryptocurrencies?
1. Inflation and Monetary Policy Adjustment
A significant decline in drug prices will alleviate core inflation pressure in the U.S. (especially in consumer electronics and pharmaceuticals), which may prompt the Federal Reserve to initiate a rate cut cycle more quickly. The current cryptocurrency market is highly sensitive to interest rate policies, and easing expectations may stimulate some capital to flow into inflation-resistant assets like Bitcoin (refer to the pattern of cryptocurrency rebounds after economic data weakness in August 2024).
2. Capital Diversion Effect in the Stock Market
Pharmaceutical sector stock prices are under pressure (e.g., Hong Kong pharmaceutical stocks have collectively dropped), which may lead some investors to turn to cryptocurrencies for excess returns. However, systemic risk spread should be monitored; if the U.S. stock market declines overall due to policy uncertainty, it may trigger cross-market panic selling].