The much-anticipated March PCE inflation data has come out in line with expectations, leaving market participants wondering about the Federal Reserve’s next move. This inflation metric is the Fed’s most preferred inflation gauge and suggests that Chair Jerome Powell and the FOMC will likely keep rates unchanged at the May meeting.
US PCE Inflation Data Comes In At 2.3%
U.S. Bureau of Economic Analysis data show that the March U.S. inflation data came in at 2.3% year-over-year (YoY), in line with expectations, and 0% month-over-month.
Meanwhile, the core PCE data came in at 2.6% YoY, the lowest since June 2024. This development is significant as this data is what the Fed uses as its primary inflation gauge and could determine its decision at the May FOMC meeting.
With the PCE inflation data stalling, Powell and the FOMC look unlikely to cut interest rates at the May meeting holding between the 6th and 7th.
Tesla’s Q1 2025 financial report reveals that despite missing revenue expectations, the company still holds over $951 million worth of Bitcoin.
After its initial purchase in February 2021 and the sale of 75% of its Bitcoin holdings in July 2022, Tesla currently holds approximately 11,509 BTC.
Bitcoin Remains a Strategic Asset for Tesla
According to a filing with the US Securities and Exchange Commission (SEC) on April 22, 2025, Tesla’s Q1 revenue reached $19.34 billion. This figure falls significantly short of market expectations, which stood at $21.37 billion.
The electric vehicle segment, Tesla’s primary revenue stream, posted a 20% year-over-year decline. The main reason is a 13% drop in deliveries and a 16% reduction in production.
Despite this, Tesla’s stock price has dropped 41% since the beginning of 2025, under pressure from controversies surrounding CEO Elon Musk’s involvement in government roles and ongoing protests against the company.
A key point of interest in Tesla’s Q1 2025 financial report for the crypto community is the company’s Bitcoin holdings. As of March 31, 2025, Tesla owns 11,509 Bitcoin, valued at approximately $951 million, according to data from Bitcointreasuries.net.
Bitcoin’s 12% decline in Q1 2025 slightly reduced the value of Tesla’s BTC stash from $1.076 billion at the end of 2024. However, today, with Bitcoin prices rising 6% to $93,000, the value of Tesla’s Bitcoin holdings has again exceeded $1 billion.
New regulations by the Financial Accounting Standards Board (FASB) require companies to mark digital assets to market value each quarter, impacting Tesla’s financial reporting. Previously, this rule enabled Tesla to record a $600 million profit from Bitcoin in Q4 2024 due to market appreciation.
Thus, Tesla did not make any Bitcoin-related transactions during this quarter. This indicates the company is sticking with a HODL strategy, treating Bitcoin as part of its strategic investment portfolio. Other major firms, like Strategy and Metaplanet, are also following this long-term holding approach.
Elon Musk Refocuses on Tesla
Tesla’s continued Bitcoin holding amid market volatility shows Elon Musk’s confidence in the cryptocurrency’s long-term potential. However, it also raises questions about the fate of Tesla’s BTC stash, especially as Musk is expected to reduce his focus on DOGE and shift more attention back to Tesla starting this May.
“Not stepping down, just reducing time allocation now that @DOGE is established,” Musk stated.
Tesla now stands at a critical crossroads, with Dan Ives, an analyst at Wedbush, calling it a “code red situation.” If the current scenario persists, Musk may be forced to restructure Tesla’s financial strategy, including its Bitcoin holdings.
BeInCrypto reported that the cryptocurrency market will be volatile in the short term until mid-May 2025, citing economic pressures and trade policy uncertainty. The market might stabilize in mid- to late-Q2, supported by historical trends and loose monetary policy. Strong growth is expected in Q3, driven by Bitcoin’s post-halving cycle, institutional adoption, and clearer US crypto regulations.
Welcome to the US Morning Crypto News Briefing—your essential rundown of the most important developments in crypto for the day ahead.
Grab a coffee to see what experts say about Bitcoin (BTC) amid prevailing market turmoil caused by Trump’s tariffs and broader macroeconomic events. BeInCrypto reported that the status of Bitcoin as a hedge against economic uncertainty is coming under scrutiny. Now this view is becoming increasingly tangled.
Bitcoin Price Closes In On $89,000 While Traditional Markets Slide
On Monday, the S&P 500 and Nasdaq extended their declines, while the US dollar index (DXY) also fell to a 3-year low. The turnout highlighted a divergence in performance between crypto and equities.
S&P500, Nasdaq, and US DXY price performances. Source: TradingView
“Only 6 times since the 1970s have the DXY and SPX fallen together: 70s stagflation, Gulf War, Greenspan hikes, the dot-com crash, 9/11… Buyback window opens Friday for US corporates,” VanEck Head of Digital Assets Research Mathew Sigel commented on X.
The selloff in equities came amid heightened political tension and renewed concerns over the Federal Reserve’s (Fed) independence. President Donald Trump escalated his criticism of Fed chair Jerome Powell.
“Powell’s termination cannot come fast enough!” the President wrote on Truth Social.
The post followed earlier remarks hinting at Powell’s potential removal, an idea reportedly being reviewed by Trump’s economic advisors.
Trump also suggested the economy would slow unless interest rates were cut immediately. The bone of contention between Trump and Powell is that while the president pushes for interest rate cuts, the chair advocates a more cautious stance.
Market reaction was swift:
The Dow Jones Industrial Average plunged 971.82 points (2.48%) to 38,170.41.
Nasdaq Composite fell 2.55% to 15,870.90.
The S&P 500 dropped 2.36% to close at 5,158.20.
The so-called “Magnificent Seven” tech stocks were hit hardest.
Tesla sank 5.8%
Nvidia slid more than 4%
Amazon and Meta both dropped around 3%.
Industrial heavyweight Caterpillar also lost 2.8%.
Meanwhile, Bitcoin is bucking the trend, steadily approaching the $89,000 threshold while traditional markets slide. A decisive move above this level could see the pioneer crypto hit the $90,000 target highlighted in Monday’s US Crypto News briefing.
Historically, Bitcoin’s performance has shown an inverse correlation with the DXY. This prompts speculation that a pivotal moment for the pioneer crypto may be on the horizon.
“The DXY has broken down to March 2022 levels. Bitcoin is back on the move,” highlighted analyst Ben Werkman.
BeInCrypto contacted Geoff Kendrick regarding the Bitcoin price outlook as traditional finance (TradFi) shows weakness. The Head of Digital Asset Research at Standard Chartered said Bitcoin’s resilience signals a shift in how investors perceive the digital asset.
In his opinion, the king of crypto is now increasingly seen as a hedge against risks in TradFi and US Treasuries.
“I think Bitcoin is a hedge against both TradFi and US Treasury risks. The threat to remove US Federal Reserve Chair Jerome Powell falls into Treasury risk—so the hedge is on,” Kendrick told BeInCrypto.
This sentiment aligns with a recent report when US 10-year treasury yields fell below 4%. The incident signaled a potential shift in Fed policy and sparked renewed interest in Bitcoin and other risk assets.
Sentiment is Improving for Crypto, Bitwise Europe Analysts Say
According to the Tuesday Newsletter from Bitwise Europe, the firm’s proprietary Cryptoasset Sentiment Index has flipped to a “slightly bullish” reading.
“At the moment, 8 out of 15 indicators are above their short-term trend. Exchange inflows and the BTC funding rate have both improved since last week,” Bitwise analysts noted.
Bitwise also noted a continued high correlation between Bitcoin and altcoins, which suggests that a surge in Bitcoin’s price could spill over to other tokens. According to the newsletter, around 20% of tracked altcoins outperformed Bitcoin over the past week.
On the TradFi side, Bitwise reported a marginal uptick in Cross Asset Risk Appetite (CARA), which rose from -0.59 to -0.43. CARA is the firm’s proprietary gauge of market sentiment across traditional asset classes.
While the CARA index is still subdued, it points to a modest rebound in risk appetite. This renewed interest aligns with Kendrick’s view that Bitcoin’s number one purpose in a portfolio is to hedge against risks to the existing financial system.
“Bitcoin’s number one purpose in a portfolio is as a hedge against risks to the existing financial system, due to its decentralized ledger, and this can play out via two routes, as private sector risks like the March 2023 SVB collapse and risks associated with the government sector, such as US Treasury risks,” Kendrick told BeInCrypto.
The Standard Chartered analyst said the current threat to the Fed’s independence via Powell’s potential replacement falls squarely into the second of these categories.
“In terms of what is measurable the current threat plays out via US Treasury term premium, which is now at a 12-year high, 10Y term premium,” he added.
