Tariff Policy: A 'Double-Edged Sword' of Macroeconomics
On the last weekend of March, financial markets are deeply mired in a downtrend, with the upcoming tariff policy being the biggest uncertainty factor. Trump's trade advisor Navarro revealed in an interview with Fox that next week's tariff policy will increase auto tariffs by about $100 billion, with other tariffs expected to generate approximately $600 billion annually. From theoretical data, the interest expenditure on U.S. debt is expected to be about $1.3 trillion in 2025, an increase of about $111 billion compared to 2024. The incremental auto tariffs alone are expected to cover this additional interest, and the overall increase in tariff revenue could nearly halve U.S. interest expenditures.
However, reality is not as simple as the numbers in an Excel sheet. Tariffs, as a pass-through tax, are ultimately borne by American consumers and businesses, leading to rising prices for imported goods, increased costs for companies, and higher consumer spending, thereby pushing inflation to rebound. At the same time, tariffs have a 'reciprocal' nature; when the U.S. raises tariffs, other countries often retaliate with their own tariff hikes, directly impacting U.S. export industries, especially manufacturing, ultimately affecting employment and GDP growth. If GDP growth slows, government tax revenues will decrease, and the U.S. debt ratio will not only not decline but may even rise. Worse, high prices may lead to weak consumption and unsold goods, significantly reducing the expected tariff revenues. Therefore, the tariff policy in April will undoubtedly greatly increase the difficulty for risk markets, and its impact is not a simple good or bad assessment, but rather a complex 'game.'
Bitcoin Market: Waiting and Watching
From the data performance of Bitcoin, the weekend price trend is not optimistic, but there is no panic in the market, and trading volume remains low. Some retail investors are starting to exit due to fears of tariffs, which may further exacerbate risk aversion on Monday. Currently, the dense chips in the $93,000 to $98,000 range have not shown significant fluctuations, and the bottoming process at $83,000 is still progressing slowly. In such a market environment, most investors choose to remain on the sidelines, with only short-term investors who have recently bottom-fished exiting due to losses.
Meanwhile, Bitfinex's USD interest rates are performing well, with a significant influx of funds driving up demand for USD lending. Currently, there are orders offering an annualized return of 18%, and leveraging Bitfinex's platform advantages, users can lock in stable high-yield returns directly. This phenomenon reflects the market's strong pursuit of stable returns amid uncertainty.
Hotspot Focus: Industry Dynamics and Market Reactions
(1) Federal Reserve and Interest Rate Expectations
Fed's Daly stated that there is a reasonable expectation of two interest rate cuts in 2025. This statement has attracted widespread attention in the market, as expectations of rate cuts often significantly influence the flow of funds and asset prices in financial markets. For the cryptocurrency market, rate cuts may encourage more funds to flow into risk assets, providing potential support for the prices of cryptocurrencies like Bitcoin.
(2) Grayscale and ETF Applications
Digital asset management giant Grayscale has submitted an application for a spot ETF for Avalanche (AVAX) to the SEC, designating Nasdaq as the intended listing exchange. If approved, AVAX will have its first exchange-traded fund focused on it. This move reflects institutional attention and layout in niche areas of the cryptocurrency market, which may also positively impact AVAX's market liquidity and price trends.
(3) Trump-related Policies and Controversies
Tariff policies have widespread impacts: Trump's tariff policies not only disrupt global financial markets but also have indirect effects on the cryptocurrency market. The uncertainty has heightened market risk aversion, leading to increased price volatility of cryptocurrencies like Bitcoin.
Stablecoin Regulatory Turmoil: Five Democratic senators have written to the Fed and OCC, questioning the USD 1 stablecoin launched by the World Liberty Finance (WLFI) supported by Trump's family, arguing that it poses 'unprecedented risks.' Trump holds a 60% stake in WLFI and has weakened regulatory independence through executive orders, raising concerns about the stability of the financial system. Meanwhile, WLFI has raised $550 million through two token sales since its establishment in September 2024 and launched USD 1 on the BNB chain and Ethereum on March 24, coinciding with Congressional deliberations (GENIUS Act), further exacerbating market uncertainty.
(4) Dynamic of Crypto Projects
Terraform Labs Creditor Claims Initiated: The bankrupt blockchain company Terraform Labs has announced that it will officially open the creditor claims application channel for crypto creditors on March 31, with a deadline of April 30. Creditors must submit wallet addresses, exchange API keys, and other asset ownership proofs. If using trading records or other 'manual evidence,' the review period will be longer. The company committed to paying creditors between $185 million and $442 million in compensation as part of its restructuring plan approved last September, with funds sourced from a $4.47 billion settlement agreement with the SEC, which has agreed to prioritize ordinary creditors. This claim involves investors affected by the $40 billion collapse of the Terra ecosystem in 2022, and its progress will impact investor confidence in the cryptocurrency market.
Hyperliquid Launches On-Chain Asset Delisting Voting Mechanism: Decentralized derivatives protocol Hyperliquid announced the completion of an on-chain upgrade, integrating an asset delisting voting mechanism based on staking weight. Delisting will be automatically triggered after validators reach the required staking ratio to vote. The first demonstration case will vote on the delisting of MYRO perpetual contracts at 13:00 UTC on March 29, with Hyper Foundation validators 2-5 participating in the vote, while validator 1 will abstain. Although this fully on-chain governance experiment does not require off-chain coordination, the official stated that most validators may still publicly disclose their voting intentions in advance to enhance transparency.
Binance Wallet Function Update: The Binance wallet team has launched a feature that allows users to trade millions of tokens on the chain using funds from the Binance exchange (CEX). This feature provides users with a more convenient trading method and helps enhance their experience in cryptocurrency trading.
LayerZero Reveals Second Round Airdrop Plan: Cross-chain interoperability protocol LayerZero CEO Bryan Pellegrino stated that the next round of airdrop distribution plans will be completely different from the first round and may be based on RFP (request for proposal) or other methods, focusing solely on real usage. This news has sparked widespread discussion in the community regarding LayerZero's future development and user participation methods.
Four.meme Platform Liquidity Pool Adjustment: The Four.meme platform announced that it will conduct a significant liquidity pool update on March 31 (specific time to be determined), planning to switch the liquidity provision method to PancakeSwap V2 and directly destroy all newly created and launched tokens LP after going live. This adjustment aims to optimize the platform's liquidity management and enhance the user trading experience.
(5) Opinions and Voices of Figures
CZ Responds to Investment Matters: CZ responded on the X platform regarding Abu Dhabi's $2 billion investment in Binance, stating that there are no bet clauses and no strategic considerations from a personal perspective. This response alleviated market speculation about the complex terms behind Binance's financing.
Zhu Su Interprets RWA: Zhu Su stated that institutional investors are interested in RWA (real-world assets) because they hope that every $1 of total locked value (TVL) in RWA can be converted into a certain proportion of protocol token market value, such as $100 million of RWA generating $100 million of token value. He likened RWA to 'USD Launchpool.'
SEC Chair Nominee Focuses on FTX Incident: SEC Chair nominee Paul Atkins expressed concern during a Senate Banking Committee hearing about reports of FTX founder Sam Bankman-Fried (SBF)'s parents and Stanford profiting from the FTX fraud incident, promising to review the SEC's investigation into relevant connections. Republican Senator John Kennedy also criticized the SEC's slow response to this incident, emphasizing the need for ongoing accountability inquiries. This hearing is the first step in the confirmation process for four financial officials nominated by Trump.
Market Downturn Cause Analysis: Exness financial market strategist Inky Cho believes that the recent decline in the cryptocurrency market is related to the panic sell-off triggered by Mt.Gox's debt repayment transfer of BTC, while Trump's comments about an economic recession have also impacted the stock and cryptocurrency markets. From a macro perspective, Bitcoin maintains a correlation of about 40% with Nasdaq, and there is polarization between Bitcoin and ETH and other altcoins. Bitcoin is more like a tool for hedging against economic uncertainty and U.S. tariffs, while altcoins are linked to the tech industry and Nasdaq market. In the long run, Bitcoin's role as a tariff hedging tool may strengthen.
Ethereum and Bitcoin: Different Fates Under Narrative Differences
Can Ethereum attract support from 'big players' like MicroStrategy and ETFs, and develop into an asset on par with Bitcoin? The answer is no. Bitcoin adheres to an 'eternal narrative,' with its core value lying in its 'unchanging' code rules, a cap of 21 million, and no need for technical upgrades. Its founder, Saylor from MicroStrategy, calls it the 'ultimate capital asset,' aligned with the 'anti-inflation' consensus of gold, rising in the post-2008 financial crisis era of global central bank quantitative easing, precisely resonating with institutions' anxieties over the collapse of trust in fiat currency.
And Ethereum$ETH Focus on 'technical evolution narrative,' emphasizing continuous technical iterations such as PoS transformation, ZK-Rollup, account abstraction, etc. However, this 'volatility' contradicts the 'stability' sought by institutions; each major upgrade is accompanied by regulatory reassessments and ecological compatibility risks. The technical complexity also deters ordinary investors and institutions, who fear it may become a 'tech stock'-like high-risk asset. The market currently favors the simpler, more certain narrative of Bitcoin. If Ethereum cannot find a 'meta-narrative' similar to Bitcoin's, its 'capital asset' attributes will always be weaker than BTC's.
Market Analysis and Investment Advice
This week has seen a flurry of major market events. A series of actions by Trump, such as military action against Iran, have intensified the situation in the Middle East and boosted safe-haven sentiments for gold. With tariffs looming, the market has experienced a cliff-like sell-off, which may be what Trump hopes for: to wash out the market before taking action to showcase his 'savior' image. Against this backdrop, the exposure of both large and small non-farm data has been significantly reduced.
For Bitcoin, the support level of $76,600 is crucial; if it falls below this, the downward space will further open up. The resistance levels are at $83,315 and $85,141, with key points including $79,164, $80,751, and $82,033. Currently, the price is being pressured by the $82,033 weekend resistance, and this wave of decline is a good opportunity to test the validity of the monthly level's second touch.
For Ethereum, the support levels are at $1,775, $1,713, and $1,640, with the resistance level at $1,905. Ethereum is facing a significant crisis since its inception, and Vitalik's recent actions have further sparked dissatisfaction in the market.
In terms of operational advice, medium-term spot investors may wait for opportunities to increase positions on the right side, while long-term investors should continue to stay put. Day traders in ultra-short contracts should lower their expectations and prioritize the safety of their principal. The current cryptocurrency market is in a fundamental contradiction between strong external expectations and weak internal realities. Although there are many favorable factors in the market, the lack of internal value support keeps it in a 'chaotic' state. Breaking the deadlock will take time, and the opportunities for value investment may only arise after the wave of market speculation has passed.
