Crypto market tumbles as Elon Musk’s DOGE arrives at the SEC

The crypto market continued its sell-off on Friday as a risk-off sentiment prevailed ahead of Donald Trump’s Liberation Day and after the strong US inflation data.

Bitcoin (BTC) crashed below $84,000, down by over 5.5% from its highest point this week. Most altcoins also dropped, with the most notable laggards being Polygon (POL), JasmyCoin (JASMY), Bonk (BONK), and Injective (INJ), which crashed by over 10%. 

The main reason for the crypto market crash was a report by the Bureau of Economic Analysis that revealed that US inflation rose in February. That report raised the odds that the Federal Reserve will be more hawkish this year. However, a Bloomberg analyst expects the bank to cut rates rapidly in the second half of the year, saying:

“With the Fed on hold for now, they’ll likely need to cut rates in the second half of the year more quickly — and likely by more — than the latest dot plot shows they anticipate.”

Further, Donald Trump’s Liberation Day is nearing. In addition to the automobile tariffs announced this week, Trump has pledged to implement reciprocal tariffs on allies and foes. 

The crypto market also dropped even as a team from Elon Musk’s Department of Government Efficiency or DOGE arrived at the Securities and Exchange Commission. 

Trump has tasked Musk to shake up all parts of the Federal Government. According to its website, Musk’s operation has saved taxpayers over $130 billion. 

DOGE’s arrival at the SEC is notable because the agency is tasked with policing the financial market, including crypto. For example, the agency is now investigating tens of spot crypto ETF filings by companies like Canary, Grayscale, and Franklin Templeton. 

It is not clear which savings DOGE will recommend at the agency, though data shows that 500 workers have accepted voluntary buyouts and deferred-resignation offers. 

The arrival also happened a day after Paul Atkins was grilled in Congress. With Republicans in control, the odds are that he will be approved to be the next SEC Chair.

The SEC has become a more friendly place for cryptocurrencies under Trump. It has hinted that it will approve many crypto ETFs, and most importantly, it has ended the lawfare against many crypto companies like Coinbase, Kraken, and Uniswap.