President Trump signs reciprocal tariff executive order
On April 2, 2025, U.S. President Donald Trump signed an executive order imposing a baseline 10% tariff on all imports, aiming to return the country to economic prosperity reminiscent of previous centuries. The order also includes reciprocal tariffs, set at roughly half the rate that U.S. trading partners impose on American goods. For example, if China applies a 67% tariff on U.S. imports, the U.S. will respond with a 34% tariff on Chinese products. Additionally, a flat 25% tariff was announced on all automobile imports. President Trump emphasized that from 1789 to 1913, the U.S. thrived as a tariff-backed nation, suggesting that reinstating such policies could eliminate the need for income taxes and bolster the economy. Commerce Secretary Howard Lutnick supported this move, proposing the replacement of the Internal Revenue Service with an “External Revenue Service” funded by tariffs.
Following President Trump’s announcement of sweeping reciprocal tariffs, the cryptocurrency market experienced significant volatility. Major cryptocurrencies, including Ethereum (ETH) and Solana (SOL), saw notable declines. Ether dropped over 6%, falling below the $1,800 mark, while Solana decreased by 6.5%, reaching approximately $118. Among the top 10 cryptocurrencies by market capitalization, several experienced similar downturns. This market reaction reflects investor concerns about the broader economic implications of the new tariff policies and their potential impact on global trade dynamics.
Source: Cointelegraph
Ethereum’s price bottoms out, but pro traders remain cautious
Ethereum’s price has shown signs of stabilizing after a period of decline, with a 6.4% increase from its March 30 low of $1,768. Despite this uptick, the cryptocurrency has struggled to regain the $2,000 level. Analysts attribute part of the downturn to the deflating memecoin market, which has reduced activity across decentralized applications (DApps) and the broader crypto space. Derivatives metrics indicate that professional traders remain cautious. The premium on Ether futures relative to spot markets rose to 4% on April 2, up from 2% on March 31, yet it remains below the neutral 5% threshold. This suggests that investors are not yet bullish on ETH’s near-term prospects. Additionally, the 25% delta skew in ETH options markets has retreated from 9% to 7%, indicating ongoing risk aversion. Despite these challenges, Ethereum’s adoption remains robust, with stablecoin holdings nearing an all-time high of $124.5 billion and a total value locked (TVL) of $49 billion, underscoring its dominance in decentralized finance (DeFi). However, the reduced network activity and declining interest in sectors like memecoins and non-fungible tokens (NFTs) continue to pose challenges for ETH’s price recovery.
Source: Cointelegraph
Pump.fun introduces DeFi lending to fuel memecoin purchases
Pump.fun, a platform that enables users to create and launch memecoins effortlessly, has recently introduced a decentralized finance (DeFi) lending feature aimed at financing memecoin purchases. This new service allows users to borrow funds directly through the platform to invest in various memecoins. The integration of DeFi lending into Pump.fun’s ecosystem is designed to lower the barriers to entry for users interested in participating in the memecoin market, providing them with additional capital to leverage their positions.
However, this development has raised concerns among industry observers and financial analysts. The memecoin market is known for its high volatility and speculative nature, often compared to gambling due to the lack of intrinsic value in many of these tokens. Introducing lending services that facilitate borrowing to invest in such assets could amplify financial risks for users, especially those who may not fully understand the potential for significant losses. Critics argue that providing easy access to borrowed funds for speculative investments might encourage irresponsible trading behaviors and lead to increased financial instability among retail investors.
The broader cryptocurrency community has expressed mixed reactions to Pump.fun’s new feature. Some view it as an innovative step towards integrating DeFi services with emerging crypto trends, potentially attracting more users to the platform and expanding the reach of decentralized financial products. Others, however, caution that without proper safeguards and user education, such services could contribute to market manipulation and exacerbate the already prevalent issues of scams and “rug pulls” in the memecoin space.
Regulatory bodies are also likely to scrutinize this development closely. The intersection of DeFi lending and highly speculative assets like memecoins presents a complex challenge for regulators aiming to protect consumers while fostering innovation in the financial sector. The potential for increased leverage and risk exposure among retail investors may prompt calls for clearer guidelines and oversight of platforms offering such combined services.
In summary, Pump.fun’s launch of DeFi lending services to finance memecoin purchases represents a notable evolution in the cryptocurrency landscape, blending decentralized finance with one of the most speculative segments of the market.While it offers new opportunities for users to engage with memecoins, it also raises significant concerns regarding financial risk, investor protection, and regulatory implications. As the situation develops, it will be crucial for both users and industry stakeholders to approach this new feature with caution and a thorough understanding of the associated risks.
Source: Yahoo