Crypto Market Steadies, But Fed Jitters Linger

BTC's modest Saturday gain helped steady the broader crypto market, which rose by 1.01%, taking the total market cap to $3.14 trillion.

Crypto Market Steadies amid Trump Tariff Threats, Impact on BTC Demand

BTC price showed a modest gain on Saturday, helping to stabilize the broader crypto market. Overall, the market experienced a slight uptick, with a 1.01% increase in value. This brought the total market cap to $3.14 trillion.

However, cryptocurrencies faced an ongoing challenge as geopolitical risk and uncertainty surrounding the Federal Reserve's (Fed) interest rate path continued to impact demand for BTC. Notably, US President Donald Trump's ongoing tariff threats remained a headwind in the crypto market.

If implemented, these tariffs would increase import duties, potentially heightening inflationary pressures. A spike in inflation could compel the Fed to maintain a more hawkish stance, which would likely weigh on demand for BTC.

Earlier this week, Trump spooked global markets by threatening to impose sweeping tariffs on automobiles, semiconductor chips, and pharmaceuticals. Significantly, these tariffs could trigger a full-blown US-China trade war, which would undoubtedly impact the global economy.

Since Trump's initial threat of tariffs on Canada, China, and Mexico, BTC price has dropped from $105,993, reaching a February low of $91,274 before steadering.

Meanwhile, in the US BTC-spot ETF market, recent developments in US tariffs and signals from the Fed impacted the scene. The market logged outflows of $552.5 million in the week ending February 21 (previous week: -$580.2 million).

According to data from Farside Investors, here are the key flow highlights for the week ending February 21:

* BTC spot ETF outflows hit a four-week low.

* Total outflows from BTC spot ETFs since March 2022 now stand at $1.02 billion.

* Outflows from Grayscale's BTC Trust (NYSE: GBTC) and ProShares Trust II (NYSE: BITO) led the outflows.

* Meanwhile, inflows into the Valkyrie XBTO Trust (NASDAQ: VOO) and VanEck Trust largely offset the outflows.

* Outflows from BTC spot ETFs began in February, following a seven-week period of inflows.

* BTC spot ETF outflows may dampen demand for BTC further as investors await new price catalysts.