The 47th president of the United States inauguration went off without a hitch. In his speech afterward, Trump didn't offer many surprises, focusing mainly on “Make America Great Again” and bad luck to everyone else.
The biggest disappointment was that Trump didn't mention cryptocurrencies at all. As a result, BTCUSD initially fell, then rose again, and now trades at around $103k per coin. As for TRUMPUSDT, at the time of writing, the coin has fallen about 27% since yesterday, and SOLUSD has lost about 1%.
At least there has been no panic selling. But as they say, it's not over yet. If the long-awaited Bitcoin strategic reserve is not announced in the next few days, market optimism could start to fade. Therefore, it is advisable to remain vigilant and not bet all your life savings on long positions in altcoins.
Once that's sorted out, macroeconomic indicators will likely drive the market. If inflation picks up and the Fed is forced to keep rates high this year, demand for riskier assets, including cryptocurrencies, could decline, as we saw toward the end of last year.
As for threats to impose new tariffs on U.S. allies, Trump mentioned plans to impose tariffs of up to 25% on imports from Canada and Mexico starting February 1 and up to 100% on Chinese imports if Beijing does not sell at least 50% of TikTok's U.S. operations to a U.S. company.
He also hinted at possible tariffs on EU products if they no longer buy U.S. oil and suggested 100% tariffs on BRICS countries if they create a currency to replace the dollar or use another currency as an alternative. It seems these are the new ways of doing business: comply or face trade restrictions.
Regarding market reaction, the Hang Seng China Enterprises index rose 1.18% on Tuesday as the new U.S. president announced no immediate action against Beijing on his first day. There were no signs of pessimism on European bourses either, with the Stoxx 600 opening higher on Tuesday.
Whether this is the calm before the storm depends on what the new president's team decides to do; if the tariff threats are nothing more than negotiating tactics, the outcome could be positive. However, if implemented, sentiment could sour and ultimately drag down global market indices.