On a day like today, when 100% of cryptos are down, it’s worth asking: what’s really happening? Even TAO is down quite a bit — but the reasons have little to do with TAO itself.
The driver is simple: inflation data came in “hot” — higher than expected. That means the Federal Reserve in the U.S. is less likely to cut interest rates anytime soon.
Why does this matter? Because Bitcoin tends to rise when the Fed cuts rates. That’s one reason Donald Trump wants the rate cuts — he and his family reportedly own a significant amount of Bitcoin and other cryptos.
Here’s the chain reaction:
When the Fed cuts rates → borrowing gets cheaper → people spend more → prices go higher.
Higher inflation → dollar-denominated assets like Bitcoin often go up.
Bitcoin itself was invented to counter exactly these kinds of inflationary practices by governments, such as the Fed manipulating US money supply.
But for now, everything in crypto is highly correlated with BTC. TAO shouldn’t be, and eventually won’t be — and the same can be said for ETH. But at the moment, the market moves in lockstep. And because TAO has a high beta to Bitcoin, its moves are amplified both up and down when correlations tighten.
That’s why today’s down move in TAO has nothing to do with TAO’s fundamentals.
Even for BTC, this is temporary. Remember: the President of the United States and six of his cabinet members own Bitcoin. The rich gets richer; they will get BTC up one way or the other.
As the old saying goes: “Don’t fight City Hall.” Well, City Hall right now is Trump — and he wants Bitcoin higher.
Which means TAO will ultimately move much higher too, especially as we approach the next halving and the subnet cap increase.
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