Original | Odaily Planet Daily
Author | Wenser
Upon waking up, the cryptocurrency market once again experienced a 'Monday flash crash'.
In$Bitcoin (BTC.CC)$ After briefly surpassing $97,000 last week, Bitcoin's weekly closing price remained above $95,000. Just as the market anticipated that Bitcoin would drive an overall recovery of the crypto market, a long-awaited 'sharp correction' struck again — within just a few hours, Bitcoin temporarily fell below $92,000 and is currently trading at approximately $92,700. $Ethereum (ETH.CC)$ Ethereum briefly dropped below $3,200 and is now trading at $3,208. $Solana (SOL.CC)$ Solana quickly broke below $140 and is currently trading around $133.Coinglass datashows that in the past four hours, the market liquidated $593 million worth of positions, with long positions accounting for $566 million; over the past 24 hours, 238,400 traders were liquidated.
The primary trigger for this 'Black Monday' might still be attributed to a series of disruptive actions by Trump.
Sudden change in the nomination for the new Federal Reserve Chair: 'Dove' Hassett may be out, while 'Hawk' Kevin Warsh's chances soar
As the 'heart of the lifeline of the U.S. economy,' the Federal Reserve has long played the role of a 'God's hand' in the U.S. and even the global economic system with its monetary privileges, independent status, and detached stance. The individual who chairs the Federal Reserve is the most crucial figure behind this 'God's hand.' With the current chairman, Powell, nearing the end of his term, the nominee for the next chair is of vital importance and is regarded as a 'market bellwether.'
Previously, Kevin Hassett, White House Economic Advisor, was considered a strong contender due to his 'pro-Trump' stance and 'support for interest rate cuts,' indicative of a dovish position. However, Trump has not provided clear indications, and recently, the pool of candidates for the next Federal Reserve Chair has narrowed to include Federal Reserve Governor Christopher Waller, former Governor Kevin Warsh, Blackrock executive Rick Rieder, and Hassett.
The latest developments suggest that Hassett may have been eliminated, while Kevin Warsh’s chances have surged. White House Economic Advisor Kevin Hassett indicated that Trump would likely ask him to remain in his current role, which would remove him from the race for the next Federal Reserve Chair. Last week, Trump expressed reservations about nominating Hassett to succeed current Federal Reserve Chair Powell during an event at the White House, telling the Chairman of the National Economic Council: 'To be honest, I actually hope you stay where you are now.' When discussing the White House last Sunday, Hassett remarked: 'There are many excellent candidates, and the President will likely make the right decision, believing that my best position is here (the White House) at present.' Hassett described himself as 'flattered and grateful' regarding Trump’s comments about his future, referring to the President as 'a really good person.'
Following Trump’s remarks, traders on the prediction market website Kalshi increased the likelihood of Warsh securing the position to 60%, while the chances for Hassett and Waller stood at 16% and 14%, respectively. Traders on Polymarket also reflected similar dynamics, with Warsh garnering 60% support, Hassett at 15%, and Waller at 13%. Previously, Warsh and Hassett were seen as having equal chances.
Powell’s term as Federal Reserve Chair will conclude on May 15. The selection process is being led by U.S. Treasury Secretary Bessent. Interestingly, last night, U.S. Treasury Secretary Bessent publicly stated: 'Trump is committed to safeguarding the independence of the Federal Reserve. We have four outstanding candidates for the position of Federal Reserve Chair. I believe the Senate would be satisfied with any one of these four candidates being elected.'
Previously, Trump announced he would appoint Powell’s successor this month but did not specify a date. As Trump approaches the one-year anniversary of taking office, the market perhaps remains insufficiently resilient to his indecisive approach, resulting in a significant loss of confidence in the cryptocurrency market, directly causing the market to crash.
Trump’s 'Tariff War Hat-Trick': Greenland Dispute and EU-U.S. Tariff Conflict
Meanwhile, looking at the overall global economic landscape, destabilizing factors continue to rise.
Greenland Becomes Euro-American Political Focal Point as Tariff Tensions Resurface
As an exclave of the European Union, Greenland has long been regarded by Nordic country Denmark as its 'backyard garden.' Now, this status quo may face a sudden change.
In May of last year, Trump made bold statements suggesting the possibility of 'military seizure of the island'; six months later, at the beginning of this year, these remarks were reiterated by White House Press Secretary Leavitt: discussions are currently underway regarding the purchase of Greenland. The option of seizing Greenland by force has not been ruled out, and all options are under consideration.
Following the 'lightning raid on the Venezuelan presidential palace and the capture of Maduro,' this external statement undoubtedly caused alarm among Greenland, multiple EU countries, and even nations worldwide.
Previously, the Trump administration had considered offering financial incentives to persuade Greenlanders to secede from Denmark and 'join' the United States, with the cost being a one-time payment ranging from $10,000 to $100,000 for each of the 57,000 Greenlanders. It must be said that, in Trump’s unorthodox approach, behind every political decision lies an 'economic calculation.'
Ultimately, this 'Greenland Crisis' evolved from a territorial dispute into a 'high-tariff trade war'—on January 18, Trump publicly announced that due to issues related to Greenland, starting February 1 this year, the United States would impose a 10% tariff on all goods exported to the U.S. by Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland, with plans to increase the rate to 25% on June 1. These tariff measures will remain in effect until an agreement is reached on the 'full and complete purchase of Greenland.' This demonstrates his resolute stance, epitomizing the attitude of 'not stopping until the goal is achieved.'
In response to this news, multiple EU countries are considering imposing tariffs on $93 billion worth of American goods exported to Europe.
In April of last year, a similar 'tariff trade war' was first initiated by Trump, and now, this factor remains a key influence on the cryptocurrency market and even the global economy.
Moreover, Trump's move is not only about 'territorial disputes' but also carries some implications of an 'economic counterattack.'
Trump: The EU's hefty fines on U.S. tech companies are extremely unfair
On January 15, U.S. President Trumpissued a public statementThe EU's imposition of hefty fines on American tech companies is extremely unfair and represents a discriminatory move targeting the superiority of U.S. technology and taxation. Relevant data indicates that in 2024, the total fines levied by the EU on American tech companies reached 3.8 billion euros, while the total corporate income tax for all European-listed internet technology companies during the same period was only 3.2 billion euros. Currently, American tech giants such as Apple, Google, and Meta are all facing billions of euros in fines or back-tax rulings from the EU. It is evident that Trump has long been dissatisfied with the EU's 'high-pressure policies' regarding economic sovereignty.
Obstacles to the "Crypto-Friendly Act" May Become a Potential Factor in Market Decline: CLARITY Faces Consensus Crisis
Beyond macro-level impact events, the obstacles faced by the CLARITY Act, which is closely tied to the cryptocurrency market, may have also contributed to a sudden surge in market sell-offs and flash crashes in prices.
Perspective: Delay in U.S. Senate Crypto Market Structure Bill Heightens Regulatory Uncertainty, Related Assets Under Pressure
Alex Thorn, Head of Research at Galaxy Digital, previously stated that the postponement of the scheduled review meeting on the crypto market structure bill by the U.S. Senate Banking Committee highlights deep divisions between Congress and the industry on several key issues, particularly those related to stablecoin yield mechanisms and DeFi-related provisions.
This delay occurred hours after Coinbase CEO Brian Armstrong withdrew his support for the bill. Armstrong publicly opposed the provisions in the bill concerning tokenized securities, restrictions on DeFi, and stablecoin yields. Subsequently, Tim Scott, Chairman of the Senate Banking Committee, announced the postponement of the hearing, but no new schedule has been announced yet. Due to the Senate's recess next week, the earliest restart could be between January 26th and 30th.
Alex Thorn pointed out that within a short span of 48 hours, the draft bill was released late at night, over 100 amendments were submitted, and stakeholders continued to discover new points of contention at the last minute, significantly increasing the difficulty of political coordination. On the market side, following the announcement of the delay, crypto assets generally declined, with Bitcoin and Ethereum falling approximately 2% on the day; related U.S. stocks also came under pressure, with Coinbase dropping 6.5%, Robinhood falling 7.8%, and Circle declining 9.7%.
He believes that although a consensus has been largely reached on the 'market structure,' insurmountable political rifts have formed around non-core but highly sensitive issues such as stablecoin yields, DeFi compliance, and granting the SEC regulatory tools in the area of tokenized securities. 'The apparent gap in differences is small, but the substantive chasm is deep.'
Previously, several tokenization companies, including Securitize, Dinari, and Superstate, refuted Coinbase's statements opposing the CLARITY Act.
Summary: The pullback may continue, with traders taking phased profit exits.
Last weekend, trader Eugene posted on his personal channel stating that due to the underperformance of certain investment targets in the market, he decided to take profits for the time being and has largely exited long positions in altcoins. However, core Bitcoin long positions are still being held, while cash positions have been significantly increased to prepare for the next round of trading strategies.
As BTC rebounded from the range of $85,000-$90,000 to above $97,000, considering factors such as expectations of macro rate cuts, global geopolitical and economic conditions, and the rise in prices of precious metals like gold and silver, taking profits may be the optimal choice amid high-risk volatility.
From this perspective, the pullback in the crypto market may continue in the short term, and whether it can retrace a bull market trajectory might, as was the case last year, still depend on Trump’s “TACO-like performance.”
Editor/Doris
