Scent of a turnaround

After facing down a fierce, macro-fueled squall, crypto seems to have found a mooring, at least as of early Tuesday. And while ominous weather remains on the horizon, the largest digital asset has demonstrated some noteworthy sturdiness, sailing back into the green.

Rebounding stock markets in Asia appeared to help restore some risk-on confidence as Bitcoin nearly reached $81,000 late Monday night. BTC is still in the red (-7%) on a 30-day basis.

U.S. President Trump's market-roiling tariff initiative continues to confound investors and business leaders who are anxious, harried and prone to latching on to small glimmers of wiggle-room possibilities, such as Trump's statement yesterday that he was prepared to negotiate with Japan.

Dow Jones Industrial Average futures were sharply rallying as of 7 a.m. (EST) in the wake of one of the most chaotic one-day sessions ever: from the intra-day low to the high, the Dow on Monday swung 2,595 points.

Investors today seem to be betting on a scenario in which negotiations take center stage from here, and that worst-case fears begin to abate. Although, Trump has threatened more, even stiffer tariffs on China which in turn has vowed to "fight to the end."

Treasury Secretary Scott Bessent suggested in an interview with Fox News yesterday that tariff negotiations with some 70 countries could last through June. Bessent behind the scenes is reportedly urging Team Trump to get on the same page; asked point blank by a reporter at the White House as to whether his tariffs are permanent or negotiable, Trump answered "both." 

The benchmark 10-year Treasury yield has since climbed above the 4% level. “It appears that the storm is easing,” said veteran money manager Louis Navellier, pointing to higher treasury yields.

"Mr. President, start talking trade deals and end the tariff meltdown," the New York Post editorial board pleaded.

Ethereum fell to $1,478, a two-year low, yesterday before recovering to a perch right around $1,600. As of 7:20 a.m. (EST), ETH was $1,570, up 5% in 24 hours, per CoinGecko.

Over the past month, ETH has shed 26%, underperforming the broader cryptocurrency market. It's not entirely a matter of being swept up in tariff turmoil. The Ethereum network's Pectra upgrade, originally scheduled for this month, was unexpectedly delayed, creating some extra pressure on ETH's spot price, according to Cointelegraph.

XRP, also gouged amidst a broader de-risking trend, has firmly rebounded overnight, gaining 7%. But the fourth-largest token remains down 11% since last Tuesday. It stood at $1.91 as of 7:30 a.m. (EST). XRP's recent high of about $3.30 — or roughly ten cents shy of its 2018 record high — occurred back in January, on the weekend prior to Inauguration Day.

Speaking of inaugural events, today marks the debut of XRP’s first-ever U.S.-listed ETF. Surprisingly, the vehicle is a 2x leveraged ETF, managed by Teucrium Investment Advisors, versus, say, a non-leveraged spot XRP product. "Very odd," pointed out Bloomberg's ETF analyst Eric Balchunas.

That there is now a leveraged XRP ETF trading on the NYSE Arca makes it likely that regular XRP ETFs can't be too far off. WisdomTree, Bitwise, 21Shares, Canary Capital and Franklin Templeton all have submitted XRP ETF proposals that are under evaluation by the SEC (Decrypt).

"Nothing but impressive."

That's how Bernstein analysts are describing the relative resilience of Bitcoin lately.

In prior periods of acute turmoil — such as the start of the pandemic back in March of 2020 — BTC experienced far more severe downside volatility.

BTC only losing 5% in the past week suggests there is "demand for Bitcoin from more resilient capital," the analysts told The Block.

The analysts argue that the foremost digital asset, sometimes dubbed digital gold, can indeed be considered as akin to actual gold in terms of representing a long-term store of value.

"Bitcoin trades as a higher volatility and more liquid version of gold," the Bernstein analysts said.