The fear index is close to a “extreme” level
The reason behind panic is clear: the commercial war broke out with all its strength. The main bags of the world are dyed red and investors run towards assets considered refuge. The VIX volatility index jumps up to 39 points, and the crypto fear and greed index falls to 23, which reflects a situation of “extreme fear” in the sector.
The current fall of the cryptocurrency market caused liquidations worth US $ 1,000 million, According to Coinglass data. Bitcoin settlements increased to more than US $ 342 million in the last 24 hours, while those of Ethereum amounted to $ 296 million. The other leading tokens were Dogecoin, Cardano, Sui, Litecoin and Chainlink.
The data show that more than 324,760 operators were settled on Monday, being the largest of a bitfinex operator who lost more than US $ 23 million in the last 24 hours.
The continuous fall made the cryptocurrency fear and greed index descend, very closely, to the extreme fear zone of 17.
During the weekend rumors circulated – more desires that certainty – about a possible turn in Trump’s tariff policy: flexibility, postponement or even cancellation of some tariffs. None of that happened. On the contrary, the president’s response was blunt.
“I don’t want anything to fall, but sometimes you have to take medicine to fix something. We have a commercial deficit of one billion with China. We lose hundreds of billions a year. Unless we resolve that, there will be no agreement,” Trump said. At his side, the secretary of Commerce, Howard Lutnick, confirmed to CBS News that the tariffs will not be postponed: “They will go into force. They will be maintained for days and weeks.” The Treasury Secretary, Scott Besent, completed the message ensuring that, despite the interest of more than 50 countries, it is already too late to negotiate: “It is not something that can be resolved in days or weeks.”
As if that were not enough, the president of the Federal Reserve, Jerome Powell, warned Friday that the impact of tariffs on the US economy could be greater than expectedand ruled out any urgency to cut interest rates. The fear of a recession becomes increasingly tangible.
“This was the last nail in the coffin,” summarizes Ipek Ozkardeskaya, Swissquote Bank’s senior analyst. Holger Schmieding, Berenberg chief economist, goes further and warns that, if Trump opts to climb reprisals instead of negotiating, his policies could become “the worst global economic error since an American administration triggered the financial crisis of 2008”.
Javier Molina, senior analyst from Etoro, agreed: “We are not facing a simple correction, but in the face of a crisis of trust that neither central banks nor political leaders are handling well. And that is really worrying. “According to Molina, the markets are reacting to a rise of” abrupt, messy and without a clear plan “tariffs, which qualifies as” an error of historical proportions. “
“ANDL S&P 500 has fallen 10.5% in just two days. We are not talking about a punctual scare, but about a deep deterioration in market expectations ”, warns.
On the technical level, Molina acknowledges that Bitcoin still shows some strength: “It marked a minimum higher than many technological ones, indicating that investors, for now, continue to trust positions.”
What does the market analyze
Julián ColomboGeneral Director of Argentine Bitso said that “A 7% drop in BTC and similar descents in other cryptocurrencies reflects the sensitivity of the crypto ecosystem against high -impact macroeconomic and political ads, such as those made by Donald Trump in recent hours. Although there are still multiple interpretations at stake, the markets read their comments as a possible sign of greater state intervention or political instability, which generated a quick exit of risk positions. “
“In that context, Bitcoin, which came from several months of very solid rise, was one of the most quickly corrected assets. However, since Bitso We interpret this correction as part of the natural volatility of a market that has grown more than 100% in the last year and continues to show solid foundations, “he added.
“We see two factors that support this vision: on the one hand, the record entry of institutional capital through ETFS; on the other, an adoption increasing We believe that beyond the juncture of this ‘Black Monday’Bitcoin has a margin to recover and continue with his upward trend in the medium term. “
As Colombo explains, it is an increasingly integrated market to the global financial system, and therefore, exposed to exogenous shocks, but also with more sophisticated tools to absorb them. Colombo concluded: “We continue to see the crypto ecosystem as a space of opportunityespecially for those who understand that volatility is part of the road to greater maturity in the market. ”
For his part, Richard Teng, CEO of Binance, warns that the resurgence of the Commercial protectionismespecially from the US, it is generating High volatility in global marketsincluding cryptocurrency. In the short term, this macroeconomic uncertainty causes Risk aversion Among investors, but in the long term it could Promote interest in crypto as a reserve of non -sovereign valueespecially in assets such as Bitcoinperceived as resistant to economic crises and geopolitical tensions.
The Binance Research report, “Tariff climb and crypto market: impact analysis”deepens how the most aggressive tariff policies since the 30s – as the new 10% general tax and tariffs of up to 54% to Chinese imports – are causing fears of a commercial war and reconfiguring the macroeconomic panorama.
In the short term, for Teng this scenario causes a defensive response from investors, who choose to withdraw and expect more clarity on the course of economic growth, international politics and trade. However, in the medium and long term, the manager points out that this uncertain environment could strengthen the attractiveness of digital assets as non -sovereign value reservesin particular Bitcoin, which continues to be perceived as a resilient refuge against economic stress and global political changes.
In line with this analysis, Binance Research published the report “Tariff climb and crypto market: impact analysis”which examines how the hardening of commercial policies, especially from the US, is generating shock waves into the global economy and transforming the perspective for digital assets.
Among the main findings of the report are:
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The reintroduction of aggressive tariffs by the USA.including a 10% general tax and rates of up to 54% on Chinese products, has aroused the fear of a new large -scale commercial war.
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Direct macroeconomic impacts In inflation, growth and monetary policy expectations of the Federal Reserve, raising the risk of a scenario of stagflation.
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The change in the perception of the crypto as a risk assetevidenced by a 25.9% drop in the total market capitalization and a volatility marked in sectors such as IA, memecoins and solutions Layer 2.
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An analysis of the evolution of the correlation between Bitcoin, gold and stock marketswith focus on its potential to resume your narrative as an active refuge against economic instability.
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A prospective look on the key factors to follow in the coming months, such as a possible commercial escalation, imported inflation pressures, monetary policy decisions of the Fed and specific events in the crypto market.
Source: Ambito
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