🔎How will tariffs impact crypto?
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🔎How will tariffs impact crypto?
📊 On-chain alpha
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🗞️ The latest DeFi news
🔎How will tariffs impact crypto?
Yesterday was Trump’s Liberation Day.
During his speech, Trump announced a series of significant tariffs on almost every major country. And the markets didn’t seem to like this too much.
The reason for these tariffs seems to be to bring manufacturing back to the US.
It’s a noble goal, but is this really the best way to do that?
I guess history will tell if this was the right decision.
In the meantime, though, the financial markets have been heavily affected by the market uncertainty which was caused by tariffs.
So what’s going to happen next?
Trump has been talking about tariffs for months.
And now that the US tariff numbers are officially out, we could say that the tariff news is mostly priced in, and the worst of this dip should be over.
But the problem is this:
A lot of countries (including China and European countries) have announced plans to impose retaliatory tariffs on the US.
If they actually do that, this could lead to the beginning of a massive global trade war, which would result in a big increase in the prices of several goods.
There’s also a recession risk to take into consideration.
Polymarket is pricing in a 45% chance that the US enters a recession this year. Higher prices caused by tariffs could reduce consumption and lead to this.
However, there's also light at the end of the tunnel in my opinion.
If most US tariffs remain as they’ve been announced yesterday for the next few years without being reduced, this could hurt the economy badly.
But if Trump uses tariffs only as a negotiating tool to force other countries to eliminate their tariffs on the US, this could be a big win for the US (and also for our bags as the stock market would likely rise as a consequence) in the end.
The post below (written by the son of Donald Trump) is suggesting that Trump is open to negotiating trade deals.
What’s next depends primarily on Trump’s next moves.
He’s been quite unpredictable over the past few months, so I’m not going to pretend I know what he’s going to do.
But one thing is clear to me:
In the short term, there will continue to be a lot of market uncertainty, at least until the US and other countries (hopefully) negotiate some trade deals.
So, what to do now?
Personally, I’m currently using my capital primarily in 2 ways:
For yield & airdrop farming using stablecoins
There are lots of good yield opportunities especially on Sonic and Berachain.
I found a lot of them using DeFillama’s free Yield Dashboard.
How I use it:
Click on “Attribute” → select “Stablecoins” and “No IL”
Then click on “TVL” → introduce a minimum of 300000 ($0.3M)
And that’s it.
All you have to do after that is to scroll through the list of opportunities that DeFillama displays and find the best one for you.
For making hedged bets
By hedged bets, here’s what I mean:
Let’s say I’m bullish on FLUID and I’m bearish on SHIB at the same time.
Generally, when the market conditions are great, I would just buy FLUID.
But given the current market uncertainty, I prefer to buy FLUID and short SHIB at the same time. In this way, regardless of whether the market goes up or down, I will make money as long as FLUID outperforms SHIB.
For the example I mentioned above, for every $1 worth of FLUID I buy, I would short $1 worth of SHIB with 1x leverage to neutralize my position.
This method is also called ‘pair trading’.
It’s a risky strategy, though, as you can easily get liquidated if you don’t manage your risk well, so I don’t recommend trying this with large amounts of money.
But it can be a decent way to make sure you make money in all market conditions as long as you pick the right tokens.
Yet, regardless of what you do right now, my advice is to prioritize survival.
At some point, everything will start going up again.
And when that happens, the people who managed to protect their capital and stay in the game will be the ones who benefit the most.
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On-chain Alpha🔎
Berachain had the highest net flows in the past 30 days
Crypto Meme😂
The latest developments in DeFi
Circle, the USDC stablecoin issuer, filed for an initial public offering
Aave Integrated Chainlink’s Smart Value Recapture mechanism, which is expected to increase Aave’s revenue by 8 figures
Sonic Labs introduced SonicCS 2.0, a new consensus protocol that will make the network 2x faster
Beraborrow, one of the largest dApps on Berachain, launched its token POLLEN. 60% of the protocol fees will be allocated to initiatives voted by POLLEN stakers
Pendle has been deployed on Berachain
mETH Protocol launched Season 3 of its Methamorphosis Airdrop Program. S3 will run for 180 days
Kaito introduced the Rewards Station - a platform where you can see the projects that are rewarding users for their X activity
Hyperlane introduced its token HYPER and announced its airdrop
Kamino introduced Kamino Meta-Swap, an aggregator that delivers the best price execution for any token swaps on Solana
Frax Finance expanded its stablecoin frxUSD to Solana
Ethereum’s privacy pools have officially launched
Superseed, a blockchain that enables self-repaying loans, went live
Initia, a network for omnichain rollups, announced its airdrop
Mass enabled trading 40+ tokenized stocks and ETFs on Base L2
Everclear launched a $CLEAR Buyback Program. 75% of the protocol revenue will be allocated to buybacks
That’s all for this week!
Until next time,
The DeFi Investor
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