Weekly Summary: 'Liberation Day', progress of stablecoin regulation and Ethereum's renewed DEX leadership

The market didn't like Liberation Day

Bitcoin opened the week at $81,700. During Monday, the price dipped to $74,000, but later shifted to the upside.

The defining factor for bitcoin and most other cryptocurrency and traditional assets was the so-called ”Emancipation Day” - the presentation of President Donald Trump's new duties to U.S. trading partners on April 2.

The day before, on April 1, QCP Capital analysts warned that the introduction of overly aggressive tariffs could increase negative sentiment in the market and provoke further falls in risky assets.

In Q1 2025, Bitcoin, Ethereum and the S&P 500 showed the worst performance in the last three years. Since March 29, the digital asset market has lost more than $160 billion in capitalization.

With consumer confidence at 12-year lows and stock markets already shaken by a 4-5% weekly drawdown, the time to tighten trading conditions is extremely bad, QCP said.

On April 2, the bitcoin price reached a local high above $88,000 by the time Trump's presentation began. After the announcement of the U.S. government's plans, the exchange rate collapsed to Monday's level of around $82,000. 

BitMEX co-founder Arthur Hayes noted that the market ”didn't like” the new tariffs. 

In his opinion, if bitcoin holds the $76,500 level until U.S. tax day on April 15, the market will get rid of the uncertainty and volatility triggered by the announcement of duties.

During Trump's speech, the market capitalization of the S&P 500 index fell by more than $2 trillion in just 16 minutes, The Kobeissi Letter pointed out.

Within a day of the presentation, the cryptocurrency's fear and greed index collapsed to 25 points into the ”extreme fear” zone over the past 24 hours. On the eve of ”Liberation Day,” the metric was showing cautious growth.

On April 4, the volume of daily liquidations in the crypto market reached $250 million. Bitcoin managed to rise from $81,800 to $84,700, but collapsed to its initial values after China announced retaliatory duties against the United States.

Digital gold gradually recovered during the day, but then reacted again with a drawdown to the publication of labor market data in the United States. The negativity was added by the subsequent speech of Fed Chairman Jerome Powell.

At the same time, the digital gold dominance index approached 63%. The index has been increasing since January 2023.

The exchange rate continued to fall over the weekend. At the time of writing, bitcoin is trading at $82,000. The Fear and Greed Index has partially recovered and is at 35.

The dynamics of Ethereum largely coincided with digital gold. At the beginning of the week, the price was $1790.

By April 1, the chart reached a local peak near $1918. On April 2, after a drawdown to the $1750 level, the Ethereum price surpassed $1900 again, but collapsed to $1794 on the background of ”Liberation Day”.

For the next three days, the exchange rate was in the range of $1750-1840. At the time of writing, the price of Ethereum is $1742.

During the week, all assets from the top-10 list by capitalization experienced a drawdown, except for TRX with a 3.4% gain.

SOL (-8.7%), ADA (-7.1%) and DOGE (-4.7%) had the most significant losses.

Experts assessed the consequences of ”Liberation Day” ;

On April 2, US President Donald Trump announced duties for trading partners as part of the so-called ”Emancipation Day.”

The new policy provides for ”reciprocal tariffs” for a number of trading partners about half as much as they impose on U.S. goods. For other states introduced a minimum of 10%.

In particular, the announced duties for China amounted to 54%, for the EU - 20%, Vietnam - 46%, Taiwan - 32%, Japan - 24%, India - 26%, South Korea - 25%.

Trump also mentioned 25% tariffs on imported cars and auto parts.

According to experts, the effect of the introduction of duties will not be limited to short-term negative impact on the markets. 

In particular, industry experts consider that this will directly affect American miners.

Most cryptocurrency mining devices are now imported into the country from Malaysia (the new duty rate is 24%), Thailand (36%) and Indonesia (32%), noted Mason Jappa, founder and CEO of Blockware Solutions.

BitMars general manager Summer Meng added China (54%) to the cited list. All factories of Bitmain, the largest manufacturer of bitcoin mining equipment, will be affected, she emphasized.

According to The Mining Pod, the PRC-based company occupies about 80% of the ASIC-miner market. Another 7% is accounted for by its Chinese competitor MicroBT, whose enterprises are located in the same jurisdictions.

Both companies have previously announced the opening of production lines in the United States. However, their scale remains unknown, and chips for the plants are still imported from overseas.

Blockware Solutions analyst Mitchell Askew described the impact of the tariffs as ”huge”. According to him, it will lead to a reduction in imports, which will increase domestic demand.

Synteq Digital CEO Taras Kulik believes that the announced tariffs will ”suppress further development of the sector.”

According to leading BRN analyst Valentin Fournier, Trump's duties have to some extent dissipated the uncertainty around bitcoin's further dynamics, and the long-awaited clarity in U.S. trade policy ”creates preconditions for the activation of bulls.”

David Hernandez of 21Shares supported his colleague, noting that the first cryptocurrency's resilience to tariffs compared to equities could reignite institutional demand.

The network also pursued a theory that ”liberation” fees are actually designed by artificial intelligence.

Some X users turned to ChatGPT to calculate rate plans and received similar figures.

Journal of Public Economics editor Wojtek Kopczuk conducted a similar experiment and received a corresponding response.

U.S. Authorities Outline Stablecoin Regulation

U.S. authorities have two simultaneous bills to regulate Stablecoin - the STABLE Act and the GENIUS Act — under consideration. Both await debate in the House and Senate.

There are differences between the two proposals, but lobbyists from the crypto-industry suggest a coordinated effort to reconcile them to avoid delaying the process.

Taking another step toward clear regulation, on April 4, the SEC's Division of Corporation Finance named the characteristics of non-securities-based stablecoins.

According to the statement, such stablecoins are ”designed to maintain a stable value against the U.S. dollar and are backed by U.S. dollars and/or other assets that are considered low-risk and liquid.” 

Funds must be held in reserve and meet or exceed the value of the stablecoins in circulation. The issuer must issue and redeem the asset on demand in unlimited quantities.

Trading on the secondary market and the participation of intermediaries in transactions is allowed, however, the stablecoins must not entitle holders to any form of dividend or share in the issuer's company or other business.

A conflict has erupted between Justin Sun and FDT

On April 2, stablecoin FDUSD deviated ~12% from parity with the dollar amid Justin Sun's statements about the insolvency of First Digital Trust (FDT).

First Digital Trust is a Hong Kong-based fiduciary firm hired by Techteryx to manage TrueUSD (TUSD) stablecoin reserves. According to CoinDesk, FDT reportedly created a $456 million deficit on the project's balance sheet between 2023 and 2024.

According to court documents, the firm was supposed to invest the reserve funds in the Aria Commodity Finance Fund (Aria CFF) in the Cayman Islands, but directed the money to Aria Commodities DMCC, an unauthorized fund registered in Dubai. 

Matthew Brittain, listed in the documents as the manager of Aria CFF, told reporters that the two funds are linked - DMCC handles trading and CFF provides financing for the deals.

In 2022, Techteryx tried to recover the funds, but the fund was only able to reimburse a small portion. Sun then provided Techteryx with a loan to secure the redemption of the coins.

On April 2, in response to a CoinDesk report, the entrepreneur published a tweet where he called FDT unable to ensure the repayment of customer funds.

He recommended users to withdraw funds and urged regulators to pay attention to flaws in the licensing and risk management system.

The statement led to a wave of sales of First Digital Trust's own stablecoin under the ticker FDUSD and a temporary price sag to $0.88.

First Digital denied Sahn's reports and assured FDUSD was fully secured, citing relevant financial statements. The businessman's statements were called a ”smear campaign” and an ”attack on a competing business.”

On April 3, Sun held a press conference to ”uncover a major international financial fraud involving traditional financial institutions and Web3 platforms in Hong Kong.”

That same day, FDT published an official response to the allegations. According to the report, the company acted ”solely within Techteryx's instructions” and has the records to prove it.

Problems with refunds in 2022 were blamed on Techteryx. FDT claims that the Aria fund then raised concerns about compliance with KYC/AML in Techteryx's purchase of TrueUSD and the identity of its beneficiary. The fund allegedly has not yet received the necessary data.

The company also redeemed more than $25 million in FDUSD, noting that it continues to operate as normal.

On April 4, Sun offered a $50 million reward for the return of TUSD reserves ”misappropriated by unscrupulous individuals, including First Digital Trust.”

On April 5, he promised to ”prosecute the fraudsters to the fullest extent of the law.”

At the time of writing, the FDUSD exchange rate has recovered and maintains rough parity with the US dollar. Details of the alleged litigation are not yet known.

DEX supremacy has returned to Ethereum

The Ethereum network has once again taken the first place in terms of total trading volume on decentralized exchanges. Solana had held the lead since last September.

According to DeFi Llama, total trading volume on Ethereum exchanges reached $64.6 billion - 22% more than Solana's $52.62 billion.

Much of the volume came from DEX Uniswap, which reached a turnover of $30 billion. The second position among Ethereum exchanges was taken by Fluid with $9 billion, indicating growing competition.

The decrease in the trading volume on Solana, including on the Raydium and Pump.fun platforms, is explained by the decline in interest in the meme-coin segment;

In January, the ”people ecosystem” saw a surge in activity thanks to the launch of the TRUMP token. In March, there was not a single day with trading volume above $1 billion on Raydium.

The average daily trading volume of ”funny coins” on Pump.fun dropped from $390 million in January to less than $100 million in March.