logo

U.S. and China Slash Tariffs to Reignite Global Risk Appetite

By: cointurk|2025/05/13 20:00:15
0
Share
copy
The reduction in tariffs between the U.S. and China has markedly boosted risk appetite in global markets. The United States lowered the tariff rate on Chinese goods from 145% to 30%, while China decreased its tariffs on American products from 125% to 10%. This decision resulted in a notable 3% increase in U.S. stock markets on May 12. Initially, Bitcoin (BTC) $ 103,536 and Ethereum (ETH) $ 2,483 experienced a slight dip but soon stabilized at $103,000 and $2,400, respectively. The Rise in Risk Appetite Amid U.S.-China Tariff Reductions The temporary reduction in U.S.-China tariffs steered investors away from protectionism towards a renewed interest in risk-taking. The easing of protectionist barriers, reaching their peak during the COVID-19 pandemic, has strengthened expectations for the revival of global trade. As a result, the VIX index fell to 18, and volatility in crypto derivative markets compressed by over 5%. Traditional safe havens like gold witnessed a decline of around 3%. Selling strategies, particularly volatility selling ones, played a significant role in this decline. Alongside the strengthening U.S. Dollar Index (DXY), U.S. bond yields saw a slight upward shift. These factors reinforced investors’ willingness to embrace risk, contributing to a more stable environment in the volatile cryptocurrency markets. Shifting Capital Between Bitcoin and Ethereum Bitcoin, functioning as the “digital gold,” seems caught between being a risk-averse instrument and a protective asset. With a decrease in protective buying, short-term put option demand declined, while long-term back-end buying demand gained prominence. Bitcoin’s market dominance dropping below 63% clearly indicates a capital shift towards altcoins. Ethereum’s increasing market dominance further substantiates this trend. Ethereum appears to be crafting a clearer narrative. Its collateral fees are at equilibrium, and technical improvements post the Pectra update stand out over short-term speculation. The rise in long-term futures transactions suggests ETH could be the next major allocation tool. The emergence of this new balance in the cryptocurrency market provides investors with opportunities to diversify their strategies. While Bitcoin continues to move within specific price ranges, Ethereum’s potential to attract institutional interest is gaining attention.

You may also like

How to balance risk and return in DeFi yields?

Have these yields ever been reasonable? Have we ever received the compensation we deserve for the risks taken in DeFi, and where should the future spreads be set?

Tom Lee's Ethereum Thesis: Why the Man Who Called the Last Cycle Is Doubling Down on Bitmine

Tom Lee is emerging as one of Ethereum’s most influential supporters. From Fundstrat to Bitmine, his Ethereum thesis combines staking yield, treasury accumulation, and long-term network value. Here is why “Tom Lee Ethereum” has become one of crypto’s most watched narratives.

Naval personally takes the stage: The historic collision between ordinary people and venture capital

Naval personally stepped in as the chairman of the USVC Investment Committee. This SEC-registered fund launched by AngelList attempts to bring top private tech assets like OpenAI, Anthropic, and xAI to the general public with a $500 entry threshold. It is not just a new fund, but a structural experi...

a16z Crypto: 9 Charts to Understand the Evolution Trends of Stablecoins

Stablecoins are evolving from trading tools into universal payment infrastructure, and this process is quieter and more thorough than most people expected.

Refutation of Yang Haipo's "The End of Cryptocurrency"

This may be the true test of cryptocurrency. It's not about whether the price has reached a new high, nor about who will achieve financial freedom in the next bull market, but rather whether, after all the grand narratives have been washed away by cycles, it can still leave behind some simpler, more...

Can a hairdryer earn $34,000? Interpreting the reflexivity paradox of prediction markets

Prediction markets are essentially betting on reality, and when participants can access or even influence this path earlier, the market no longer just reflects reality but begins to shape it in return.

Popular coins

Latest Crypto News

Read more