Bitcoin rebounds above US$90k amid sentiment shift

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State of crypto

• Bitcoin rebounds above US$90K as tariff delays ease market fears
• US Senate repeals crypto tax rule, ending defi reporting requirements
• Trump's Crypto Summit set to shape US digital asset regulations
• El Salvador boosts Bitcoin reserves, reassures IMF on economic stability

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Bitcoin rebounds above US$90K as tariff delays ease market fears

US President Trump's decision to delay imposing 25% tariffs on auto imports from Canada and Mexico by one month has positively impacted both cryptocurrency and traditional financial markets. For Bitcoin particularly, its price surged above US$90,000 following the announcement of the tariff delay, as it apparently helped ease investor concerns over escalating trade tensions. Major stock indices also experienced gains as the Dow Jones Industrial Average rose 1.1%, the S&P 500 increased by 1.1%, and the Nasdaq Composite advanced 1.5%.

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US Senate repeals crypto tax rule, ending defi reporting requirements

The US Senate voted 70-27 to repeal a Biden-era regulation that required decentralised finance (DeFi) platforms to report customer transactions to the Internal Revenue Service (IRS). This rule, set to take effect in the 2027 tax year, is meant to enhance tax compliance by aligning DeFi platforms with centralised crypto exchanges and traditional stock brokerages. However, the crypto industry argues that DeFi platforms, which facilitate peer-to-peer exchanges without intermediaries, do not function as brokers and that the regulation imposes high compliance costs. The repeal, achieved through the Congressional Review Act, prevents the creation of similar rules in the future and is projected to reduce federal revenues by US$3.9 billion over the next decade.

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Trump's Crypto Summit set to shape US digital asset regulations

A landmark cryptocurrency summit is set to be hosted at the White House this coming Friday, aiming to establish a comprehensive federal regulatory framework for digital assets. The summit will bring together industry leaders, policymakers, and investors to discuss key issues such as regulatory clarity, stablecoin oversight, and the potential role of cryptocurrencies in the US financial system. This initiative underscores the administration's commitment to fostering innovation within the crypto industry while addressing regulatory uncertainties.

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El Salvador boosts Bitcoin reserves, reassures IMF on economic stability

El Salvador has just announced the purchase of additional Bitcoin, bringing its total holdings to over 6,102 coins. This move comes shortly after the International Monetary Fund (IMF) approved a 40-month, US$1.4 billion program for the country, which included commitments to limit public sector involvement in cryptocurrency activities. The government assured the IMF that the recent increase in Bitcoin holdings aligns with the agreed program conditions, though specifics on how these purchases do not add to government exposure remain unclear.

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Crypto Fear & Greed Index

Source: Fear & Greed Index

BTC Markets in the news

IBT: Australia rejects crypto reserve plan as US moves forward with digital currency stockpile

Caroline Bowler, CEO of BTC Markets, expressed concerns about the potential for government intervention in the digital currency market.

"One of the core principles of cryptocurrency is its ability to exist outside of government influence," Bowler urged. "However, if major assets are increasingly tied to specific jurisdictions, it could lead to a concentration of power that contradicts the foundational ethos of crypto."

Read the full article here.

Ausbiz: The fluctuating crypto dynamics

Charlie Sherry, BTC Markets’ Head of Finance, speaks with Ausbiz about the evolving crypto landscape under Trump. Bitcoin surged past US$100K post-election amid his pro-crypto stance, while plans for a U.S. Crypto Reserve and David Sachs’ appointment as the crypto czar indicate potential market shifts.

Watch the full interview here.

The Block: US spot Bitcoin ETFs see record outflows worth $1 billion

"Trump's tariffs have continued to put pressure on global markets, leading to broader risk-off sentiment across both traditional and digital assets," said Rachael Lucas, crypto analyst at BTC Markets.

"We are also seeing typical signs of market exhaustion. After a 600% rally since late 2022, high funding rates, extreme greed in sentiment indicators, and slowing ETF inflows suggest a natural cooling-off period," Lucas added.

Read the full article here. 

Policy Week 2025 x BTC Markets

BTC Markets is proud to sponsor Policy Week 2025! From 10th -14th March in Sydney, Australia, Policy Week 2025 will bring together policymakers, industry leaders, and regulatory pioneers to shape the future of digital assets, blockchain, regtech, and fintech. This year’s event focuses on creating actionable industry outcomes in response to the rapidly evolving regulatory landscape across APAC, the UK, the EU, and the US. Join us in driving innovation and frameworks that are fit for purpose.

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The week ahead: economic events

Thursday, March 6th 

• 12:30am Australia Balance of Trade
• 1:15pm Euro Area Deposit Facility Rate and Interest Rate
• 1:30pm Canada Balance of Trade
• 3:00pm Canada Ivey Purchasing Managers Index

Friday, March 7th 

• 3:00am China Balance of Trade, Exports YoY, and Imports YoY
• 1:30pm Canada Unemployment Rate
• 1:30pm US Non-farm Payrolls, Unemployment Rate, and Fed Chair Powell Speech

Saturday, March 9th 

• 1:30am China Inflation Rate

Monday, March 10th 

• 7:00am Germany Balance of Trade
• 11:30pm Australia Consumer Confidence MoM

Tuesday, March 11th 

• 12:30am Australia NAB Business Confidence Index
• 2:00pm US Job Openings

Wednesday, March 12th 

• 12:30pm US Core Inflation Rate MoM and YoY
• 1:45pm Canada Interest Rate

Thursday, March 13th

• 12:30pm US Producer Price Inflation MoM

Source: Trading economics

Market reflections

Overview

The Australian economy showed resilience in Q4 2024, with GDP growing by 1.3% year-on-year, surpassing expectations and marking an acceleration from previous quarters. This growth was primarily driven by robust export performance. However, economic inequality has reached its highest level in over two decades, as higher incomes have grown faster than middle incomes, while the growth of lower incomes has stagnated. In the monetary sector, the Reserve Bank of Australia (RBA) anticipates a more gradual and limited rate-cutting cycle, reflecting a cautious approach to monetary easing. On the international front, Australia's Foreign Minister Penny Wong expressed concerns over increased disruptions during President Trump's second term, highlighting challenges in securing tariff exemptions and navigating the continuously shifting geopolitical landscape.

Australia

• Australia’s GDP grows 1.3% in Q4, driven by strong exports
• RBA signals a slower, shallower rate-cut cycle
• Trump’s second term seen as more disruptive, says Australia’s foreign minister
• Economic inequality in Australia hits highest level in over 20 years

Australia's economy grows, but inequality and uncertainty rise: What it means for crypto

Australia’s economy successfully showed signs of resilience in Q4 2024, with GDP growing 1.3% year-on-year, surpassing expectations and largely driven by strong exports. Despite the growth, the Reserve Bank of Australia (RBA) remains cautious, signaling a slower and shallower rate-cut cycle ahead. RBA officials noted that while inflation has eased, economic uncertainty remains, prompting a more measured approach to monetary easing. This has left financial markets and borrowers adjusting expectations for interest rate reductions in the coming months.

At the same time, economic inequality in Australia has reached its highest level in over 20 years, with high-income earners seeing significantly faster wealth accumulation compared to lower- and middle-income groups. Meanwhile, on the geopolitical front, Australia’s Foreign Minister Penny Wong has described Trump’s second term as “more disruptive” than his first, particularly in the context of trade policies and diplomatic relations. With ongoing uncertainty around tariff exemptions and global economic shifts, Australia continues to navigate a complex financial and political landscape.

What does this mean for crypto?

Economic growth, cautious monetary policy, and geopolitical uncertainty can create a mixed outlook for financial markets, and that includes crypto. While Australia’s resilience and the RBA’s slow rate-cut approach align with the US Federal Reserve’s cautious stance, liquidity conditions may remain tight. Trump’s trade policies and tariff uncertainty add to market instability. Meanwhile, rising inequality and institutional shifts continue to reflect evolving financial situations and strategies. As uncertainty persists, crypto markets will likely stay volatile in the meantime, with traders watching economic and regulatory shifts closely.

Global

• Wall Street tumbles, wiping out post-election S&P 500 gains
• US economic activity inches up, but tariff fears grow
• Oil prices hit a three-year low on US recession worries
• Japan’s GDP growth holds steady at 0.7% in Q4
• South Korea moves closer to Bitcoin ETF approval
• China sets 5% GDP growth target amid global uncertainties

United States

Wall Street tumbles as tariffs and oil slump shake markets

Wall Street has seen notable declines as part of significant market volatility caused by escalating trade tensions recently. Particularly, the S&P 500 has erased all gains made since the last election. This downturn is largely attributed to the oncoming US tariffs on imports from Canada, Mexico, and China, which have led to fears of reduced consumer spending and corporate profits.

Meanwhile, oil prices have plummeted to their lowest levels in three years, dropping over 4% to US$65.22 per barrel. This decline is driven by concerns that the ongoing trade war will dampen economic activity and decrease crude demand. Additionally, the U.S. Energy Information Administration reported a larger-than-expected rise in American crude oil stocks, further pressuring prices.

Japan

Japan’s GDP growth holds steady at 0.7% in Q4

Japan's economy maintained steady growth in the fourth quarter of 2024, with the Gross Domestic Product (GDP) increasing by 0.7% compared to the previous quarter. This marks the third consecutive quarter of expansion, driven by robust exports and moderate private consumption. On an annual basis, the economy grew by 2.8% during this period, surpassing earlier forecasts. However, corporate capital expenditures experienced a slight decline of 0.2% year-on-year, marking the first decrease in nearly four years, primarily due to labor shortages and concerns over U.S. tariff policies.

South Korea

South Korea moves closer to Bitcoin ETF approval

South Korea is moving toward approving a Bitcoin ETF. The Financial Supervisory Service (FSS), South Korea's financial regulator, has been closely monitoring Japan's legislative developments regarding crypto ETFs - which are expected to continue through the first half of 2025, with legislative plans anticipated for submission to the National Assembly in 2026. Kim So-young, vice chairman of South Korea's Financial Services Commission, acknowledged the need for careful review of spot Bitcoin ETFs, noting that countries like England and Japan have yet to introduce them.

China

China sets 5% GDP growth target amid global uncertainties

China has set its 2025 GDP growth target at approximately 5%, maintaining the previous year's goal, amid escalating trade tensions with the US. Premier Li Qiang announced this objective during the National People's Congress, emphasising the need to bolster domestic demand and create over 12 million new urban jobs to counter external economic pressures. The government also plans to increase defense spending by 7.2%, reflecting concerns over a "severe external environment."

Regulation roundup

CFTC and SEC collaborate on unified crypto regulation

The US Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) have announced a collaborative effort to establish a cohesive regulatory framework for cryptocurrencies. This initiative includes the revival of the Joint Advisory Committee, which has been inactive since 2014, to address overlapping regulatory issues and provide clear guidelines for the rapidly evolving digital asset landscape. The renewed collaboration aims to enhance investor protection and foster innovation within the crypto industry. 

SEC shifts from enforcement to structured regulation

The US Securities and Exchange Commission (SEC) is moving away from its previous "regulation by enforcement" approach toward developing clear regulatory guidelines for the cryptocurrency industry. Commissioner Hester Peirce, head of the SEC's newly formed Crypto Task Force, emphasised that the agency aims to foster innovation by providing transparent policies rather than relying solely on enforcement actions.

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