The cryptocurrency markets are under the influence of the same macroeconomic factors that are unsettling traditional finance, yet their global and decentralized characteristics offer a degree of resilience, according to Edward Felten, co-founder and chief scientist at Offchain Labs.
In a discussion on CNBC’s “Squawk Box Asia,” Felten observed that the recent fluctuations in cryptocurrency prices are largely a reflection of ongoing worries related to global trade and economic policies. These anxieties are fueled by uncertainties around U.S. tariffs and statements from President Donald Trump.
Offchain Labs is the company behind Arbitrum, which is recognized as one of the top Layer 2 solutions for Ethereum (ETH) scaling.
“The entire globe is attempting to decipher what President Trump is communicating, what his intentions are regarding tariffs, and what his ultimate goals are.”
Crypto’s Global Perspective Provides Strategic Edge
Despite some short-term instability, Felten highlighted an increasing sense of long-term confidence within the cryptocurrency sector.
“People are becoming more optimistic about the long term because the technology keeps evolving,” he remarked. “We are witnessing significantly more uptake by institutions and an increase in regulatory clarity.”
When questioned about whether Trump’s concerns over the U.S. trade deficit might relate to his views on cryptocurrency, Felten rejected the notion that cryptocurrencies are limited by national borders.
“I believe cryptocurrency is fundamentally international,” he explained. “When we consider the development teams we have and the users of our technology, we don’t perceive it as being confined by geography. It constitutes a genuinely international community and an array of companies.”
Felten stressed that although crypto markets are not insulated from global economic fluctuations, they experience fewer of the trade barriers that can disrupt other industries.
“We feel the impacts of the broader markets,” he acknowledged. “However, we aren’t constrained by the same types of border restrictions that affect certain other sectors.”