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Bitcoin has demonstrated a notable resilience to macroeconomic headwinds, according to a recent report by crypto market maker Wintermute. Despite a general market downturn, Bitcoin's price decline was relatively modest, revisiting levels seen around the US election period, while traditional markets like the S&P 500 and Nasdaq hit their lowest points in a year. This resilience marks a significant departure from Bitcoin's past behavior during crises, where its losses were typically more severe than those of traditional finance indexes. Factors contributing to this stability include increased institutional interest through ETFs and Bitcoin's positioning as digital gold. However, experts like Alex Obchakevich from Obchakevich Research suggest that this trend might be temporary, with Bitcoin potentially returning to the category of risky assets as trade wars escalate. Meanwhile, economic indicators like the CPI and PPI show signs of cooling inflation, though new inflationary risks from global trade tensions could soon impact the market.
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US Treasury Secretary Scott Bessent revealed that trade negotiations with China are currently stalled, emphasizing the necessity for direct talks between President Donald Trump and Chinese President Xi Jinping to resolve the complex issues. Despite recent discussions in Switzerland that saw both nations step back from imposing over 100% tariffs on each other’s goods, tensions are escalating again due to US actions such as revoking Chinese student visas and restricting sales of chip design software and jet engine parts to China. Additionally, the US has targeted Huawei by attempting to block its sales of advanced AI chips globally, drawing sharp criticism from Beijing. Meanwhile, domestic legal battles over Trump’s “reciprocal” tariffs continue, with a US court ruling them largely illegal, though an appellate court has temporarily upheld them during the appeal. Bessent remains hopeful, noting upcoming trade talks with Japan and asserting that international partners are still negotiating in good faith despite the legal uncertainties surrounding US trade policies.
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A federal appeals court has temporarily reinstated President Trump's extensive tariffs, reversing a prior ruling by the US Court of International Trade that declared their enactment unlawful. The US Court of Appeals for the Federal Circuit issued a temporary stay, allowing time for legal review, with the administration's briefings due by June 9. Despite the legal uncertainty, Trump's tariff agenda remains a cornerstone of his economic policy, with the White House prepared to escalate the matter to the Supreme Court if needed. The tariffs, including reciprocal duties and China-focused levies, continue to impact global trade, with ongoing negotiations involving India, the EU, and Taiwan. Corporate America, including tech giants like Nvidia and Apple, grapples with export controls and tariff threats, while analysts warn of potential economic repercussions, such as an accelerated US debt ceiling deadline. The situation remains fluid, with international tensions, particularly with China over tech and student visas, adding complexity to trade relations.
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In his Cointelegraph opinion piece, Oleksandr Lutskevych, CEO of CEX.io, argues that crypto's optimism is a structural strength, not mere hype, enabling it to withstand global crises better than traditional markets. He highlights how Bitcoin and digital assets show greater emotional resilience, with the Crypto Fear and Greed Index declining less than the Stock F&G Index during shocks like Trump's tariff announcements and the 2022 Federal Reserve rate hike. This resilience stems from crypto investors' acclimatization to volatility and a retail-driven culture of rapid innovation, contrasting with the cautious, institutional nature of equities. Lutskevych identifies two key investor groups—long-term believers who see crypto as a future-focused asset and short-term speculators more prone to panic—noting that Bitcoin's dominance by long-term holders (over 65% of supply) limits fear's impact. Despite growing institutional influence and correlations with equities potentially eroding this optimism, crypto's foundation remains solid, supported by a committed holder base, fixed supply, and strong liquidity, as seen in Bitcoin accumulation during recent tariff scares. Lutskevych concludes that crypto's embedded optimism, backed by history and principles, positions it as a system gearing up for significant future growth, even as fear dominates headlines.
