Investing.com-- Bitcoin edged marginally lower on Tuesday, marking its third consecutive day of declines as market participants remained cautious amid uncertainty surrounding U.S. trade tariffs and the Federal Reserve’s interest rate outlook.
The world’s largest cryptocurrency inched 0.3% lower to $95,472.0 by 10:29 ET (15:29 GMT).
Crypto investors on edge; await clarity to US tariffs, interest rates
Investors are closely monitoring developments in U.S. trade policy, as President Donald Trump’s administration signaled potential new reciprocal tariffs on every country taxing U.S. imports.
The prospect of escalating trade tensions has raised concerns about a slowdown in global economic growth, which could weigh on risk assets like Bitcoin.
Analysts noted that cryptocurrencies, often seen as a barometer for risk appetite, are particularly sensitive to shifts in macroeconomic sentiment.
Adding to the cautious mood, markets are awaiting clarity on the Federal Reserve’s monetary policy trajectory.
The latest U.S. Consumer Price Index (CPI) data, released last week, showed inflation persisting above the Federal Reserve’s 2% target, fueling speculation that the central bank may maintain a hawkish stance for longer than anticipated.
Higher interest rates typically reduce the appeal of non-yielding assets like Bitcoin, as investors seek safer returns in traditional markets.
Hong Kong firms join forces to launch regulated stablecoin
Standard Chartered (LON:STAN) (OTC:SCBFF) Bank (Hong Kong) (HK:2888), Animoca Brands, and Hong Kong Telecommunications (HKT) (HK:6823) have announced a joint venture to apply for a license from the Hong Kong Monetary Authority (HKMA) to issue a Hong Kong dollar-backed stablecoin.
This collaboration aims to leverage Animoca Brands’ blockchain expertise and HKT’s telecommunications services to explore opportunities in the crypto market and enhance both domestic and cross-border payments.
Stablecoins are digital assets designed to maintain a fixed value relative to a government-issued fiat currency or other reference rate. They traditionally serve as a bridge for transactions involving digital assets on blockchains, which cannot directly interact with fiat currencies.
The move comes as Hong Kong policymakers press ahead with initiatives to promote the city as a leading cryptocurrency hub.
In parallel, there is growing enthusiasm around stablecoin adoption and the introduction of cryptocurrency exchange-traded funds (ETFs).
Financial institutions are recognizing the potential of stablecoins and ETFs to provide more secure and accessible investment avenues, thereby attracting a wider range of investors to the cryptocurrency market.
Standard Chartered reiterates its $500K Bitcoin price target
Standard Chartered maintained its $500,000 Bitcoin price target, citing an evolving investor landscape with institutional, bank, and now sovereign buyers. The bank expects Bitcoin to reach this level before former U.S. President Donald Trump leaves office, driven by increased access and reduced volatility.
According to Standard Chartered, spot Bitcoin ETFs saw 499,000 BTC of buying in 2024, while MicroStrategy purchased 257,000 BTC. The bank anticipates even larger institutional inflows in 2025 but stresses the need for new buyers to sustain momentum.
"To achieve that, we need new buyers; bank buying has been large and now sovereigns have joined in too," analysts wrote.
A key factor supporting this outlook is data from SEC’s 13F filings, which show increased Bitcoin positions from banks alongside hedge funds in Q4. Notably, Abu Dhabi’s sovereign wealth fund disclosed a 4,700 BTC equivalent position in BlackRock’s IBIT ETF, signaling potential for further sovereign interest.
"The type of buyer will gradually evolve, from predominantly retail buyers pre-ETFs, to hedge funds in the early ETF period and eventually to sovereigns," Standard Chartered noted.
The bank believes this shift could offset any slowdown in MicroStrategy’s aggressive purchases, which have accounted for over 1% of Bitcoin’s total supply. Looking ahead, Standard Chartered expects pension funds and central banks to join the market as long-term institutional investors.
Crypto price today: most altcoins drop; Solana, Polygon plunge
Most altcoins were also in the red on Tuesday amid a broader risk-off mood but saw much bigger declines than Bitcoin.
World no.2 crypto Ether plunged nearly 5% to $2,680.78 on Tuesday.
World no. 3 crypto XRP dropped 5.3% to $2.55.
Solana tumbled over 9% and Polygon fell 9.4%, while Cardano was 6.3% lower.
Among meme tokens, Dogecoin sank 6.8%, while $TRUMP slipped 9.3%.
Ayushman Ojha contributed to this report.