The cryptocurrency market experienced a brief rally
today (Tuesday), with Dogecoin (DOGE) jumping 7% as traders reacted to
potential changes in US trade policy.
Speculation that upcoming tariffs may be milder than
initially expected, combined with the Federal Reserve’s plan for rate cuts in 2025 could be behind the renewed optimism.
This shift has also boosted memecoins like PEPE and
FLOKI, while Bitcoin and XRP experienced modest gains. $PEPE experienced a 3%
jump in the past day. Bitcoin and Ethereum are trading at $87k (representing a
7% boost in the past week), while Ethereum has gained nearly 10% in the same
period to trade at $2,058.
Crypto Markets React to Trade War and Fed Policies
Investor sentiment improved following reports that
President Donald Trump’s proposed “reciprocal tariffs,” set to take
effect on April 2, maybe more targeted than feared. Reports about Trump
Media collaborating with Crypto.com for ETFs have also boosted the market.
Some countries might be exempt, and existing metal
levies may not be compounded. Last week, the Federal Reserve raised inflation
forecasts but reaffirmed its plan for two rate cuts in 2025, reinforcing
confidence in risk assets.
This dual narrative of potential tariff relief and
continued monetary support has sparked a bullish response, particularly in
speculative crypto sectors.
DOGE and other memecoins have outpaced Bitcoin,
Solana’s SOL, and XRP over the past 24 hours, with the meme sector alone up
nearly 6% on average, according to CoinGecko data. These assets often move in
sync with broader crypto trends but offer traders amplified returns due to
their speculative nature. Retail investors tend to treat rallies in major
cryptocurrencies as signals to enter riskier trades.
The Macroeconomic Factor
Beyond macroeconomic factors, Dogecoin’s rally may
have been influenced by internal developments within its ecosystem. The House
of Doge recently signed a five-year agreement with the Dogecoin Foundation to
promote DOGE as a decentralized currency for everyday transactions.
House of Doge, tied to the Dogecoin Foundation, launched “The Official Dogecoin Reserve” with a 10M Dogecoin buy, but no public address fuels transparency doubts. Andrew DeFrancesco’s role is unclear beyond his son Devlin’s House of Doge-sponsored IndyCar gig. An X Space in April…
— Grok (@grok) March 24, 2025
The initiative also established “The Official
Dogecoin Reserve,” purchasing 10 million DOGE to bolster its credibility.
Although this acquisition is relatively small in USD terms, it reinforces
Dogecoin’s position as the leading memecoin.
Despite its recent rally, DOGE remains well below its
post-election peak of nearly $0.50, having lost over 60% of its value since
then. However, with improving sentiment in risk assets, the memecoin sector
could continue to attract speculative interest in the near term.
This article was written by Jared Kirui at www.financemagnates.com.
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