Recently, the cryptocurrency market has been sluggish. Investors had initially hoped that the White House cryptocurrency summit on March 7 would bring concrete policy benefits. Additionally, former U.S. President Donald Trump mentioned Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Solana (SOL), and Cardano (ADA) last week, which momentarily drove up prices due to market expectations. However, the summit ultimately lacked key details, and the market reaction was tepid, with Bitcoin’s price falling back to $78,706, and the mentioned altcoins also experiencing varying degrees of decline, which weakened previous gains.
The White House cryptocurrency summit was originally viewed as a critical turning point for the market, with investors anticipating that the U.S. government would clearly support the development of cryptocurrencies and provide regulatory guidance, thereby injecting more confidence into the market. However, during the live broadcast, Trump mainly reiterated the contents of the executive order, emphasizing an end to the government’s anti-cryptocurrency stance, but did not provide more specific measures. The only new content related to stablecoin legislation, but the details remained unclear, leading to unmet expectations for further policy details. This caused Bitcoin’s price to drop, and market funds flowed out, resulting in an overall decline in risk assets.
Table of Contents
- Commitment to Strategic Reserves and Market Doubts
- Impact on Bitcoin, Ethereum, and Dogecoin Prices
- The Market’s Next Steps: Inflation Data and Fed Decisions
- Short-term Outlook and Long-term Trends
- About BingX
Commitment to Strategic Reserves and Market Doubts
The Trump administration’s strategic cryptocurrency reserve plan is seen as the U.S.’s first clear acknowledgment of the strategic value of Bitcoin and other mainstream cryptocurrencies. However, Arthur Hayes, co-founder of BitMEX, pointed out that the plan lacks substantial support, arguing that the U.S. government’s current fiscal situation cannot sustain large-scale cryptocurrency reserves, and there remains uncertainty regarding the policy’s implementation.
Currently, the U.S. government is facing fiscal deficits, inflationary pressures, and a high-interest-rate environment. Whether there is sufficient funding and determination to promote the cryptocurrency reserve plan remains a key focus for the market. Market analysts generally believe that if the plan cannot be realized, it will be challenging to become a supportive factor for the cryptocurrency market in the short term.
Before the summit, the market held an optimistic attitude towards this plan, pushing Bitcoin price forecasts to briefly exceed $94,000, but as the news heat dissipated, prices quickly fell back. Ripple, Solana, and Cardano also saw pullbacks, reflecting the market’s uncertainty regarding policy implementation.
Impact on Bitcoin, Ethereum, and Dogecoin Prices
As the market leader, Bitcoin briefly benefited from the policy expectation rally, reaching a peak price of $91,233 on the day of the summit, but as of the time of writing, it has fallen back to $78,706, a decline of 13.73%, with a low point dipping to $76,606, indicating increased market volatility. The main concern in the market is whether the enforcement of policy will be sufficient to support ongoing upward predictions for Bitcoin prices.
Although Ethereum saw a short-term increase to $2,516 due to the strategic reserve’s influence, the lack of more regulatory details from the summit caused prices to fall back. Currently, Ethereum’s price is $1,845.45, having reached a peak of $2,258.47 on the summit day, with a decline of 18.29%.
Meanwhile, the long-standing meme coin Dogecoin (DOGE), though not included in the strategic reserves, still saw its price affected by overall market sentiment, struggling to escape volatility in the short term. Dogecoin’s trend has historically been driven by retail and community sentiment, but due to the recent overall market pessimism and the absence of clear support from Elon Musk, Dogecoin has failed to show strong upward momentum.
The Market’s Next Steps: Inflation Data and Fed Decisions
In addition to policy factors, the upcoming U.S. Consumer Price Index (CPI) and Producer Price Index (PPI) inflation data will significantly impact the cryptocurrency market. If the data shows a cooling of inflation, it may increase the likelihood that the Federal Reserve (Fed) will lower interest rates at its March 18-19 meeting, thereby boosting the cryptocurrency market. However, if the data indicates persistent inflation, the Fed may maintain a high-interest-rate policy, putting pressure on risk assets.
Historically, non-farm payroll data has also been an important reference indicator for the market. In January of this year, the non-farm payrolls added as many as 353,000 jobs, far exceeding market expectations, indicating that the U.S. labor market remains strong. If the March employment data continues to be strong, the Fed may lean toward delaying rate cuts, which will further affect the liquidity and price trends of the cryptocurrency market.
Short-term Outlook and Long-term Trends
In the short term, the market will closely monitor U.S. economic data and further details on regulatory policies. If policies can be implemented and provide a clear framework for enforcement, the market may resume an upward trend. However, if regulatory risks increase or the Fed’s policies are not as accommodative as expected, cryptocurrency prices may remain volatile.
In the long term, if the Trump administration’s cryptocurrency-friendly stance can continue, it may bring more institutional funds into the market, at which point Bitcoin and Ethereum price predictions could rise. However, the market still needs to be wary of regulatory agency movements, especially regarding potential risks associated with specific cryptocurrencies like XRP, SOL, and ADA.
About BingX
BingX, established in 2018, is a leading global cryptocurrency exchange, providing diverse products and services such as spot trading, derivatives, copy trading, and asset management to over 10 million users worldwide. Additionally, in response to market needs, it regularly offers historical price trends of mainstream coins like Bitcoin and historical price analyses of Ethereum, catering to different levels of needs from novices to professionals. BingX is committed to providing a trustworthy platform, equipping users with innovative tools and features to enhance their trading capabilities. In 2024, BingX proudly became the main partner of Chelsea Football Club, marking its exciting debut in the sports world.
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