Markets Just Endured One of Their Most Violent Resets

After Donald Trump's return to power sparked a full-blown trade war, global markets cratered, shedding over $11 trillion in value.

Markets just endured one of their most violent resets in recent times, with over $11 trillion in value being erased from stocks and crypto. The trigger? A full-blown trade war sparked by Donald Trump’s return to power, which blindsided investors and briefly convinced some that the next bear market had begun.

However, according to Arthur Hayes, the moment to panic has passed; it’s time to “buy everything.”

Tariffs Shock Global Markets

On April 2, an event dubbed “Liberation Day” by policy insiders, the Trump administration rolled out a sweeping set of tariffs, sending global markets into a tailspin. The U.S. slapped import duties on Chinese goods, reaching 145%, and China retaliated in kind.

The impact was immediate. The crypto market, which had been quietly recovering in Q1 2025, cratered. Over $1 trillion in value was wiped out as Bitcoin (BTC) and Ethereum (ETH) dropped sharply and high-beta tokens, including memecoins, collapsed by more than 50%.livestream

“Investor sentiment flipped on a dime,” Binance Research noted. “The market shifted into full risk-aversion mode.”

Traditional markets fared no better. Equities across the U.S., Europe, and Asia hemorrhaged capital. Export-heavy sectors, emerging markets, and even blue-chip U.S. tech stocks got hammered.

The total drawdown across equities alone topped $10 trillion, drawing comparisons to the COVID panic—only this time, the catalyst wasn’t a virus, but government policy.

One voice stood out amid the doom and gloom. Arthur Hayes, former BitMEX CEO and now a prominent macro thinker, saw it coming and said the panic wouldn’t last.

For months, Hayes had been warning that any major disruption like a U.S.-China flare-up would force the Federal Reserve’s hand. In his essays on X, he argued that the Fed would have no choice but to resume money printing and liquidity injections, especially if geopolitical instability threatened markets.

He also predicted that despite the tough talk, the U.S. and China would ultimately de-escalate, if only to protect markets.

Tariff Truce Sparks Relief Rally

That thesis began to be realized on May 12, when Washington and Beijing unexpectedly agreed to a 90-day tariff rollback. U.S. duties dropped from 145% to 30%, and China eased its retaliatory tariffs to 10%.

The reaction was swift. U.S. futures surged across the board. Bitcoin bounced back above $100,000. Ethereum reclaimed $2,500. The Nasdaq jumped 4%.

And Hayes lost no time in saying what the optimists wanted to hear: “Chi-Merica lives. It’s time to buy everything.”

To him, the sudden thaw in trade tensions, combined with early signs of Fed dovishness, is the green light for investors to go full risk-on.