Crypto faces uncertain future as Trump's "short-term pain" plan unfolds

U.S. President Trump's outspoken acceptance of short-term economic hardship has put risky assets—including Bitcoin (BTC) and the cryptocurrency market in general—under increasing pressure. According to a thread by The Kobeissi Letter on X, President Trump's strategy revolves around enduring significant "short-term pain" to bring down inflation and facilitate the recapitalization of more than $9 trillion in U.S. debt. Will cryptocurrencies survive Trump's "short-term pain" strategy? The impact on cryptocurrencies is immediate and pronounced. While U.S. stocks have lost about $5 trillion in market value this year, digital assets have also suffered major losses. Since President Trump's inauguration on January 21, Bitcoin (BTC) has fallen by about -23%, Ethereum (ETH) has fallen by about -43%, and the cryptocurrency market as a whole has experienced even steeper price drops. While high volatility is nothing new in crypto, a synchronized downturn suggests that crypto assets are not immune to macroeconomic forces. Kobeissi Letter added, "Based on our research, President Trump came to this conclusion BEFORE his inauguration. However, he began officially declaring this on March 6. Here's the headline that destroyed investor confidence in 2025. President Trump is no longer (hiện tại) 'President of the stock market.'" The Kobeissi letter points to March 9 as the day President Trump continues to affirm his position by noting that the U.S. is in a "period of transition" and that it will "take some time," implying that he is willing to accept market turmoil in the short term. During this period, Commerce Secretary Lutnick's statement on March 6—"The stock market is not driving results for this administration"—was followed by Treasury Secretary Bessent's remark, "No concern about a little volatility." While The Kobeissi Letter's analysis notes that the administration's stance was strengthened ahead of the inauguration, it cites President Trump's urgent focus on 2025, when $9.2 trillion in U.S. debt will mature or need to be refinanced. The series states, "First, as we noted earlier, the United States is facing a massive recapitalization task. By 2025, $9.2 TRILLION of U.S. debt will mature or need to be refinanced. The quickest way to lower rates before this massive refinancing would be a recession." In addition to debt concerns, The Kobeissi Letter also highlighted the administration's efforts to lower oil prices and the U.S. trade deficit as part of the same economic calculation. Since President Trump took office, oil prices have fallen by more than 20%. "Moreover, a clearly defined part of President Trump's strategy is to LOWER oil prices. Oil prices have fallen more than 20% since Trump took office. This morning, Citigroup said a drop in oil prices to $53 would reduce inflation to 2%. What will bring down oil prices? A recession." Meanwhile, the administration's widespread use of tariffs, which The Kobeissi Letter describes as "imposing tariffs on virtually ALL U.S. trading partners," is lowering GDP growth estimates, further implying that a deliberate slowdown is underway. Kobeissi Letter also noted, "Also, DOGE and Trump are trying to cut TONS of government jobs. These are jobs that account for the majority of recent job 'growth' in the United States. Government employment has increased by 2 million over the past 4.5 years. Cutting these jobs will spur a recession." DOGE leader Elon Musk appears to have resigned himself to a short-term decline. Even after Tesla (TSLA) recorded its seventh largest historic drop on March 10, Musk posted that "It's going to be fine in the long term." For crypto traders and investors, Trump's "short-term pain" scenario is now determining price action. The question, analysts from The Kobeissi Letter pose, is whether this will lead to a more favorable economic backdrop in the long term. "Is the 'short-term pain' worth the 'long-term gain' of President Trump's economic strategy?"