Crypto Market Weathering Trump's Tariffs: Binance CEO Teng Sees Temporary Downturn

The crypto market's recent downturn, following U.S. President Donald Trump's confirmation of tariffs on Canada and Mexico, is a temporary setback rather than a reversal, according to Binance CEO Richard Teng. In a Feb. 25 post, Teng reassured investors that the crypto market has weathered similar storms in the past and is expected to rebound.

Teng's comments come as Bitcoin (BTC) dipped below $90,000 on Feb. 25, its lowest level since November. The drop followed Trump's announcement that he would proceed with the planned 25% tariffs on Canada and Mexico, despite agreeing to a 30-day pause earlier this month. At the time of publication, Bitcoin was trading at $89,030.

The market sentiment, as indicated by the Crypto Fear & Greed Index, has shifted to "Extreme Fear," with a score of 21 out of 100 on Feb. 26. This represents a significant drop from the "Neutral" score of 29 recorded on Feb. 24. Similarly, Nansen's Risk Barometer has turned "Risk-off" after being "Neutral" since mid-November.

Despite the recent volatility, Teng attributed the crypto market's turbulence primarily to the U.S. Federal Reserve's more cautious approach to rate cuts. Historically, rate cuts have been bullish for crypto, as lower returns on traditional assets make investors more willing to explore riskier assets like crypto.

The strong demand for crypto ETFs and the ongoing applications for new launches in the U.S. are positive signs, according to Teng. Since Gary Gensler stepped down as Securities and Exchange Commission Chair on Jan. 20, U.S. asset managers have filed for ETFs tied to assets like XRP (XRP), Cardano (ADA), Solana (SOL), and Dogecoin (DOGE). Teng believes that the fundamental indicators of crypto's strength are getting stronger.