Crypto Markets Daily Mar 3 2025

Daily Updates:

• President Trump swiftly reversed the crypto slump of last week (that saw BTC fall more than 20% from its January ATH) with a single post on his social media platform, Truth Social. The post confirmed the President’s intention for the US to create its own Strategic Reserve via his Executive Order on Digital Assets issued in January. In that EO, only a “national digital asset stockpile” was mentioned without any specific tokens. 
• Yesterday’s post however, Trump was clearer in stating that the reserve will include at least BTC, ETH, XRP, SOL, and ADA. 
• Almost instantly, all 5 of the mentioned crypto-assets as well as a broad-based selection of tokens began to rally, recouping some of their huge losses through last month. 
• BTC surged from $85K to almost touching $95K following the announcement — ETH is currently up 6% on the day, trading close to $2.4K with XRP and SOL both posting double digit percentage gains. ADA however has posted the largest return amongst the mentioned tokens — having surged over 60%. 

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• In derivatives markets, the news brought yet another implied vol term structure inversion for both majors. Front-end volatility for BTC exceeded even the levels seen during the early February tariff scare. 
• However, vol levels at the front-end for BTC have since then dropped off, resulting in a flat term structure – ETH remains considerably inverted. 
• Unlike the inversions of February, yesterday’s inversion was accompanied with a significant spike upwards in skew for 7, 14 and 30 day BTC tenors which all temporarily skewed towards calls. However, skew levels for 7 and 14 day tenors have now returned back towards puts, whilst longer tenors remained almost unmoved through the entire event.  

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• In macro news, last Friday saw a dramatic turn in the narrative of US exceptionalism. The Atlanta Fed’s latest GDPNow forecast currently predicts a 1.5% annualised decline in GDP growth for Q1 2025. 
• The growth trajectory forecasted by the model changed following the release of the Census Bureau’s US merchandise trade deficit report which showed the US trade deficit gap widened by 25.6% between December 2024 and January 2025 – a record increase that reflects US companies increasing imports ahead of Trump’s promised tariff program.  
• The widening trade deficit alongside the 0.5% decline in consumer spending for January (the largest MoM decline in almost four years) according to the latest PCE report, resulted in the model’s growth prediction to change from 2.3% to -1.5%. 
• The inflation numbers in the PCE report however came in as expected – the core PCE price index rose 0.3% from December, and 2.6% from a year ago.

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• The US SEC has filed to drop its lawsuit against Coinbase, initially filed in 2023 for operating as a broker, exchange, and clearing agency for unregistered securities.
• Ondo Finance has partnered with Mastercard to integrate its Short-Term US Government Treasuries Fund (OUSG) into Mastercard's multi-token network (MTN). This will provide MTN clients access to OUSG via the traditional banking cash settlement route without additional web3 infrastructure.

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This Week’s Calendar:

Charts of the Day: