3rd February 2025 > > Trump's Tariff war.
tl;dr
The Trump Tariff war will kill cryptos. The Trump Tariff war will drive cryptos to insane new all-time-highs.
Market Snap

Market Wrap
With over $2bn of leveraged long liquidations – greater than even the Covid scare and the FTX fiasco – the underperformance of cryptos versus stocks is plain to see, and plain to understand.
The escalation of the Trump Tariff war could get ugly today.
Curious Cryptos’ Commentary – The Trump Tariff war, it’s all downhill from here
On Friday, Trump imposed tariffs of 25% on imports from Canada and Mexico with 10% on imports from China.
Just a day or two earlier, Trump had threatened to impose tariffs on Columbia after that country refused to take back a number of illegal immigrants who were ready to be deported. Within an hour or so of the threat of tariffs, the President of Columbia backed down, and the deportations went ahead. I am not here to debate the rights and wrongs of the situation, only to note that this outcome probably emboldened Trump to try the tactic again.
With regards to Mexico, Trump wants to apply pressure to reduce the flow of migrants over the border, and, more urgently, reduce the trafficking of fentanyl. With regards to Canada, he might not be joking when he talks about it becoming the 51st state. And China – trying to wean the Western world off its reliance on China for cheap imported goods (produced with excessively high environmental costs and alleged abuses of human rights) is not going to be easy.
But all three countries have called his bluff, with Mexico and Canada imposing their own tariffs in retaliation, and China seizing the technocratic high ground by referring the US actions to the WTO.
Head of US policy and politics at Wolfe Research, Tobin Marcus, sounds the warning:
“Markets may now need to take the rest of Trump’s tariff agenda literally rather than just seriously … If this new level of seriousness gets priced in suddenly, Monday could be a rough day for markets.”
Curious Cryptos’ Commentary – The Trump Tariff war, it’s all uphill from here
Head of Alpha Strategies at BitwiseInvest, Jeff Park, sees things a little differently.
Admittedly, he is not an unbiased observer, but neither is anyone else. If you are feeling gloomy this morning as a crypto investor, Jeff may bring you some cheer.
…
Jeff argues that Trump’s objective is to bring about Plaza Accord 2.0.
To refresh your memories, because I know you were paying attention at the time, the Plaza Accord of 1985 was an agreement by the G-5 (US, UK, Japan, Germany, and France) to devalue the dollar. Market manipulation! I hear you cry. And right you are. This one agreement arguably set the scene for the now daily market manipulation of interest rates by all “independent” central banks, an untenable situation which has somehow become normalised and accepted.
The original Plaza Accord was so successful, it was followed by the Louvre Accord in 1986 to manipulate currency markets in the other direction to halt the decline in the value of the dollar.
Once politicians and bureaucrats get involved in markets, it always goes horribly wrong.
…
Jeff thinks that a second Plaza Accord is on the cards, leading to a rapid devaluation of the dollar.
If he is right – and frankly that is a very big if – we are looking at a variation of quantitative easing on an even grander scale than ever seen before, even during Covid.
What we do know is that a devaluation of the dollar raises the price of all hard assets, especially those priced in dollars. Cryptos have the highest beta of any investment, and will therefore outperform all other hard assets in this scenario.
I have to be honest I do hope Jeff is correct. More detail right here:

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