Thought of the week

Emotional market situations lead to increased volatility and therefore also to greater price upswings and downswings. In phases in which upswings dominate, market participants tend to take short-term negativity too emotionally, resulting in actions that do not correspond to any “logic”. This leads to cascades of similar sell-offs, causing prices to temporarily fall more than necessary. These phases are often used by professional traders to buy more.

Digital Asset News

The price of Bitcoin has fallen below the key $100,000 mark for the first time in several days after US President Donald Trump signed an executive order to impose import tariffs on goods from China, Canada and Mexico. The imposed tariffs have already sparked retaliatory measures from the three countries and the crypto industry is divided on how this will affect the wider market.

According to a statement released by the White House on February 1, “Trump is imposing additional tariffs of 25% on imports from Canada and Mexico and additional tariffs of 10% on imports from China. A lower tariff of 10% applies to energy commodities from Canada”.

Shortly after Trump's announcement, Canadian Prime Minister Justin Trudeau announced in a press conference that he would impose tariffs of 25% on US goods worth a total of USD 106.5 billion in return. Meanwhile, the Chinese Ministry of Commerce announced that it would file a complaint with the World Trade Organization (WTO) and take “appropriate countermeasures”.

The founder of Crypto Capital Venture, Dan Gambardello, remains optimistic and does not see Trump as the main culprit for any downward trend.

Gambardello said: “I can't believe that there is a widespread belief that Trump's tariffs and his memecoins have ended the bull cycle.”
“BlackRock continues to accumulate ETH and BTC while retail investors are desperately panicking because crypto is currently consolidating in a sideways move,” Gambardello said.

While Jeff Park, Head of Trading Strategies at Bitwise Invest, even emphasized “how amazing a continued tariff war will be for Bitcoin in the long run.” However, not all observers agreed with this hopeful reading.
Among them was Adam Cochran, Partner at Cinnaeamhain Ventures, who replied: “Bitcoin is not separated enough from the global markets and is trading like a triple-leveraged tech stock these days.”

The Norwegian sovereign wealth fund, managed by Norges Bank Investment Management (NBIM), has also made significant investments in Bitcoin through indirect investments in a diversified portfolio of crypto-friendly companies. According to K33 Research, NBIM's indirect investments in crypto companies grew to 3,821 BTC or $356 million by the end of 2024, an annual increase of 153%.

“It is important to emphasize that these investments are likely due to a rules-based sector weighting and not a conscious decision to prioritize BTC investments,” writes Vetle Lunde, head of research at K33, adding: “NBIM's indirect investment is one of the clearest examples of how BTC will end up in any well-diversified portfolio, and the growth is proof that the market is maturing and BTC will end up in any well-diversified portfolio, whether intentional or not.”

The sovereign wealth fund's holdings include a $500 million stake in MicroStrategy, investments in crypto exchange Coinbase and stakes in Bitcoin miners Mara Holdings and Riot Platforms.
Crypto exchange Kraken is preparing to delist five stablecoins, including the market-leading USDt from Tether, in order to comply with new European crypto regulations. Kraken will delist USDt completely on March 31 to comply with the EU Markets in Crypto-Assets (MiCA) regulation, according to an official announcement from the crypto company. In addition to USDT, the exchange will also phase out support for PayPal USD, Tether EURt (EURT), TrueUSD and TerraClassicUSD (UST) in the European market. “These changes will ultimately ensure that Kraken remains compliant and can offer its European clients an exceptional trading experience in the long term,” the platform said.

This is one of the reasons why Teroxx has been following the regulated path since the beginning and introduced USDC as a stablecoin back in 2018.

Digital Asset Market

Market review and outlook

January, and therefore the start of the new year, was characterized by many contrasts. While the global financial markets experienced increased volatility and positivity and “dreamed” of more liberal and free markets following the inauguration of Donald Trump as US president, most indices and digital assets initially recorded positive price trends. Bitcoin reached a new all-time high of ~$110,000 and spot Bitcoin ETF inflows are also at very high levels. The promises made by Trump with regard to digital assets have driven the markets in recent months, leading to strong expectations. After little to no talk about digital assets and regulation/inclusion in the two weeks of his term, temporary and emotional disappointment spread through the market. Emotional market phases are often characterized by increased volatility and lead to confusing and not clearly rational price developments. Trump's rhetoric and threats (regarding tariffs, the Panama Canal and others) lead to populist actions that are attributed to individuals. January was therefore initially positive, but prices ultimately fell sharply, especially in the altcoins. A new trend could be established at any time by strengthening digital assets, the emotionality of many non-institutional is causing high volatility. February could therefore be an exciting but also challenging month!

Chart technology

From a chart perspective, Bitcoin is now once again below the psychologically important $100,000 mark. This illustrates the high volatility of recent weeks, with Bitcoin falling by ~15% and the altcoin market by ~23% in the last two weeks. If strong support is established in the coming days or weeks, these price levels could serve as a good guide. Otherwise, the focus in February should be on whether the current market momentum can be maintained or built up so that realistic market movements can follow. Past experience shows that above-average and emotional sell-offs are often used for medium-term positioning.

The next price targets in the event of a positive development: ~$98,000, ~$103,500, ~$110,000

The next price targets in the event of negative performance: ~$90,000, ~$86,000 ~$82,500

Trading idea

Altcoins currently offer good opportunities for DCA (dollar-cost-average) strategies to place the first tranche so that potential upswings can be taken advantage of and the average entry price can be reduced in the event of a negative trend. The risk/reward ratio is currently clearly in favor of opportunities, based on the price developments of the last five months.