US and Mexico Trade Tariffs Paused as XRP Leads Crypto Market Rebound
In a surprising turn of events, Claudia Sheinbaum and Donald Trump have agreed to hold off on tariffs between the US and Mexico for a month. This move has had an immediate positive impact on the cryptocurrency market, with XRP emerging as a standout performer.
Meanwhile, tensions escalate as Canadian Prime Minister Justin Trudeau pushes back fiercely against US tariff measures. With Canada deeply entrenched in the crypto market, this reaction poses a significant unknown factor.
Agreement Between US and Mexico
The proposed tariffs between the US and Mexico had sent shockwaves through the crypto market. Following the backlash from DeepSeek, tech stocks in the US were already under pressure. With additional tariffs looming over Mexico, Canada, and China, the market witnessed billions in crypto liquidations.
XRP, which had seen an impressive 300% surge post-Trump's election win, experienced a sharp 25% decline over the weekend as the US president stirred fears of a global trade war. The value of Ripple’s altcoin plummeted to $2.01 on Monday morning, hitting its lowest point in over a month.
However, Mexican President Claudia Sheinbaum managed to strike a deal with Donald Trump to temporarily halt the tariff process.
After engaging in a productive discussion with President Trump, Sheinbaum announced on social media, “We had a good conversation with President Trump with great respect for our relationship and sovereignty. We have reached a series of agreements. Our teams will commence work today on two fronts: security and trade. Tariffs will be paused for one month starting now.”
Sheinbaum further stated that her administration would instruct the National Guard to monitor the drug trade into the US, a move supported by Trump who confirmed the agreement.
With the pause in new tariffs, the markets have started to bounce back, notably reflected in Ripple’s XRP token that saw a 6% increase in value.
Positive Market Response
XRP has managed to reclaim much of its earlier losses. Additionally, several ‘made in USA’ cryptocurrencies like Cardano, Chainlink, and Hedera have shown significant recovery post this agreement.
Moving forward, the performance of these assets appears to heavily rely on the political decisions and economic strategies of the US.
Political Landscape Influencing Crypto Market Dynamics
This recent development supports the belief that tariffs could serve as a buying opportunity within the crypto space. The trade relationship between Mexico and the US is crucial, and the tough talk from Trump has led to a mutually beneficial trade resolution.
While the markets breathe a sigh of relief, concerns linger regarding the stalemate with Canada.
In contrast to Mexico, Canadian Prime Minister Justin Trudeau has stood firm against US tariffs. Trudeau publicly condemned these actions and is gearing up for a retaliatory trade battle.
Although tariffs against China seem to remain, the response from the country has been relatively restrained.
Canada’s deeper involvement in the US crypto market, with initiatives like BlackRock’s Bitcoin ETF and a substantial number of institutional investors holding crypto, raises the stakes in this ongoing saga.
Amidst the rebound from one set of tariffs, the Canadian resistance could play a significant role in shaping the industry’s future.
Ultimately, the ever-changing scenario makes it challenging to predict outcomes accurately. Sheinbaum’s swift pivot from denouncing to clinching a deal on tariffs underscores this unpredictability. The possibility of a reconciliation agreement between Trump and Trudeau looms, promising potential ripple effects on the crypto market. Clearly, we are witnessing a new era of turbulent price fluctuations.