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Starknet, known for its work on Ethereum's layer-2 scaling solutions, is now focusing on enhancing Bitcoin's capabilities through a partnership with Xverse, a Bitcoin wallet. The collaboration aims to introduce a full DeFi experience to Bitcoin users by integrating Starknet's technology in Q2 2025. This move is part of a broader effort to scale Bitcoin's transaction processing capacity significantly, from its current 13 transactions per second (TPS) to potentially thousands. Starknet plans to serve as Bitcoin's execution layer, handling transaction processing while ensuring finality through Bitcoin's blockchain. The initiative comes at a time when there's increased interest in leveraging Bitcoin's security and liquidity for broader DeFi applications. Despite the potential of OP_CAT, a proposed Bitcoin improvement that could enhance programmability, Starknet and Xverse are moving forward with their plans, using trust assumptions as an interim solution until OP_CAT's adoption. This partnership marks a significant step towards realizing trustless DeFi on Bitcoin, offering a preview of what intuitive DeFi on Bitcoin could entail.
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As President Trump escalates his protectionist trade policies, consumers in other countries are responding with boycotts of US products and reduced tourism, potentially impacting US economic growth. Goldman Sachs estimates that these foreign boycotts could decrease US GDP by 0.1% to 0.3% in 2025, equating to a loss between $28 billion and $83 billion. Notably, Canada has seen a significant backlash, with 53% of consumers participating in boycotts, particularly affecting American alcohol sales due to provincial monopolies removing US products. The Trump administration's recent tariff threats, including a 25% duty on foreign-made vehicles, have further strained international relations, leading to a decline in favorability for US brands like Tesla and a noticeable drop in tourist visits to the US. Air Canada and European hotel companies have reported significant decreases in bookings, reflecting a broader trend of travelers opting for destinations other than the US. This situation adds to the economic pressures already anticipated from tariffs and retaliatory measures, leading Goldman Sachs and other Wall Street firms to lower their US GDP growth forecasts for 2025.
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President Trump's latest trade policy moves are set to introduce sweeping changes to US trade relations, with plans for broad "reciprocal" tariffs on all trade partners and a 25% tariff on foreign-made vehicles. These actions, part of what Trump has termed "Liberation Day," are expected to be detailed in a White House event on Wednesday. The ambiguity surrounding the specifics of these tariffs has led to market uncertainty, with Trump suggesting that all countries could be affected, while his aides have drafted a proposal for a 20% tariff on most imports. The economic consequences could be profound, potentially raising consumer prices, affecting manufacturing sectors like dairy and automotive, and prompting retaliatory tariffs from countries like the EU, Canada, and China. The Federal Reserve faces a dilemma as it navigates inflation amidst these trade policy shifts, with potential impacts on economic growth and consumer behavior.
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President Donald Trump is contemplating a significant policy shift by considering a 20% "blanket" tariff on most or all imported goods, moving away from his earlier promises of targeted tariffs. This policy, part of his "Liberation Day" rhetoric, aims to address the complexities and political challenges of implementing country-specific duties. However, this approach has raised concerns among economists about its potential to stoke inflation by over 2%, reduce household buying power significantly, and push the average US tariff rate to levels not seen since 1872. Despite these warnings, Trump's team views the tariffs as a means to achieve ambitious revenue goals, with estimates suggesting they could raise substantial funds, although not as much as some projections if other countries retaliate. The policy's simplicity might ease implementation but could also lead to political and economic turbulence, especially if markets react negatively to the announcement.
