Trump’s tariff pause led to a a lot wanted crypto market restoration. The US President additionally signed an govt order exploring a US sovereign wealth fund. This began hypothesis about potential Bitcoin investments, particularly after a social media submit from Senator Cynthia Lummis. Moreover, Treasury Secretary Scott Bessent was appointed appearing director of the CFPB after Trump eliminated Rohit Chopra. For now, the explanations behind Bessent’s non permanent management of the CFPB remains to be unclear. Trump now has a variety of his most popular candidates main main US monetary regulatory our bodies.
Trump Pauses Tariffs on Canada and Mexico
The cryptocurrency market skilled a pointy rebound after an announcement by US President Donald Trump that proposed tariffs on Canada and Mexico can be briefly paused. The transfer got here after discussions with Canadian Prime Minister Justin Trudeau, who confirmed in a assertion on X that the 25% tariffs will likely be on maintain for at the very least 30 days.
Trudeau additionally shared Canada’s plans to enhance cooperation with the USA by implementing a $1.3 billion border safety plan, which incorporates the appointment of a Fentanyl czar, classifying cartels as terrorist organizations, and reinforcing the US-Canada border with helicopters and extra personnel.
Mexico’s tariffs have additionally been delayed for a month. Mexican President Claudia Sheinbaum said that each governments reached a sequence of agreements, together with reinforcing the shared land border whereas concurrently engaged on commerce and safety issues. Regardless of the pause, Trump advised Bloomberg TV that negotiations are nonetheless ongoing and tariffs may nonetheless be imposed if agreements weren’t finalized.
In the meantime, the chief order issued on Feb. 1 that imposed tariffs on Mexico and Canada additionally included a ten% tariff on China, which remains to be in impact. A Wall Road Journal report recommended that China’s authorities is keen to barter, with its preliminary proposal reportedly centered on restoring the Part 1 commerce deal from 2020. This commerce deal dedicated Beijing to rising its purchases of US exports by $200 billion over two years.
On the crypto-based prediction market Polymarket, merchants positioned odds of 24% that Trump will utterly take away the tariff on Mexico earlier than March and a 21% likelihood that Canada’s tariffs will likely be revoked. China, nevertheless, has solely a 7% chance of seeing its tariffs lifted subsequent month.
Mexico tariff elimination odds (Supply: Polymarket)
The crypto market noticed very massive losses only a day earlier than, when Trump first introduced the proposed tariffs on items from China, Mexico, and Canada. In truth, the announcement led to an estimated $10 billion value of liquidations.
Nonetheless, after the bulletins from world leaders relating to the tariff pause, the market was in a position to recuperate. Bitcoin surged previous the $100,000 mark, reaching $101,007 after plummeting to a low of $92,000 the day gone by, based on CoinMarketCap. Ethereum additionally noticed a bounce to $2,809 after dropping to $2,451 on Feb. 2. The Crypto Concern & Greed Index mirrored this shift in sentiment by transferring into the “greed” territory with a rating of 72.
Trump’s Sovereign Wealth Fund Sparks Bitcoin Hypothesis
President Donald Trump additionally not too long ago signed an govt order directing the federal government to discover the creation of a sovereign wealth fund. Naturally, this transfer sparked hypothesis about potential Bitcoin investments by the US authorities.
Throughout a press occasion within the Oval Workplace on Feb. 3, Trump tasked Treasury Secretary Scott Bessent and Secretary of Commerce Howard Lutnick with beginning the method, and said that the fund will goal to “monetize the asset facet of the US steadiness sheet.” Bessent confirmed that the chief order will likely be enacted throughout the subsequent 12 months.
Trump signing EOs within the Oval Workplace
Whereas Trump and his officers didn’t explicitly point out cryptocurrencies as a part of the fund’s funding technique, they recommended the federal government may purchase TikTok, which remains to be beneath quite a lot of strain on account of a legislation requiring its guardian firm, ByteDance, to divest its US operations or face a possible ban.
Nonetheless, hypothesis round Bitcoin involvement heated up after Wyoming Senator Cynthia Lummis hinted on social media that the sovereign wealth fund could possibly be used to purchase BTC. Bitcoin advocate Wayne Vaughan additionally recommended that Bessent and Lutnick would possibly contemplate allocating a part of the fund to crypto.
Thus far, Trump’s govt orders have confronted very fast authorized challenges since he took workplace on Jan 20. A few of his actions have already been blocked by courts, together with an order making an attempt to revoke birthright citizenship, which a federal choose deemed unconstitutional. His latest govt actions on cryptocurrency have additionally stirred some debate. On Jan. 23, Trump signed an order establishing a crypto working group whereas banning the event of a US central financial institution digital foreign money (CBDC), although authorized specialists have questioned the enforceability of this.
Trump Appoints Treasury Secretary as CFPB Performing Head
US Treasury Secretary Scott Bessent, who was confirmed by the Senate lower than per week in the past, can even function the appearing director of the Client Monetary Safety Bureau (CFPB) after an order from President Donald Trump. The choice was made after Trump eliminated former CFPB Director Rohit Chopra, who had urged his successor to proceed investigations into Large Tech and Wall Road companies. The rationale behind Bessent’s non permanent management of the CFPB remains to be unclear. That is particularly attention-grabbing as he simply took on the function of overseeing one of many nation’s largest monetary departments.
Assertion from the CFPB
Earlier than his affirmation, Bessent aligned himself with the administration’s stance on monetary laws, together with opposing the creation of a US central financial institution digital foreign money. The Trump administration has been reportedly searching for methods to restrict the regulatory attain of businesses overseeing banks, and Tesla CEO and unofficial presidential adviser Elon Musk advocated for the elimination of the CFPB altogether.
Moreover, Trump signed an govt order on Jan. 20 instructing all authorities businesses to pause proposed guidelines. This directive may enormously affect regulators just like the Securities and Change Fee (SEC), the Commodity Futures Buying and selling Fee (CFTC), and the CFPB.
With Chopra’s elimination, Trump now has a number of of his most popular candidates main main US monetary regulatory our bodies. SEC Commissioner Mark Uyeda is presently appearing chair whereas the Senate considers Trump’s nomination of Paul Atkins for the function. CFTC Commissioner Caroline Pham additionally changed Rostin Behnam as appearing chair on the day of Trump’s inauguration.
The CFPB is presently going through authorized challenges over its regulatory authority. Know-how commerce teams TechNet and NetChoice filed a lawsuit towards the bureau’s rule that seeks to control cost apps and digital wallets in the identical approach as conventional banks. The rule was finalized in November of 2024, and it appears to exclude crypto wallets and solely applies to transactions which might be performed in US {dollars}.