Tariffs, AI, & Crypto! Why ALL Markets Feel Broken Right Now
Bitcoin is trading at a five on the fear and greed index — lower than during the FTX collapse, yet no major crypto firm has blown up this cycle. Markets are whipsawing on Trump tariff announcements, revocations, and reinstatements, while the Supreme Court wades into unprecedented territory. Meanwhile, AI doomer fanfiction is going viral, Jane Street stands accused of rigging Terra Luna's collapse, and the Pentagon is demanding unfettered access to Anthropic's models. The question isn't whether something will break — it's which thread will snap first, and whether crypto can find its footing in a world where uncertainty itself has become the dominant asset class.
Key Takeaways
Bitcoin's fear index hit a historic low of five — worse than FTX, Terra Luna, or the COVID crash — despite no major bankruptcies, signaling deep structural doubt about the industry's future.
Trump's tariffs were struck down by the Supreme Court, only to be immediately re-imposed under different legal authority, leaving $150–175 billion in potential refund claims and casting uncertainty across global trade and markets.
Jane Street is accused of insider trading that helped collapse Terra Luna in 2022, and may be suppressing Bitcoin's price today through Tradfi derivative manipulation — a reminder that synthetic instruments can undermine the 21 million cap.
Meta is reviving its stablecoin ambitions with an RFP for integration across Facebook, Instagram, and WhatsApp, potentially bringing stable coins to billions of users and accelerating the path to a trillion-dollar stablecoin market.
Anthropic is resisting the Pentagon's demand for unfettered AI access, including mass surveillance and fully autonomous weapons, but faces a coordination trap where rivals like xAI may defect and win lucrative contracts.
In a Nutshell
Crypto is trapped in a doom loop of doubt — not because anything blew up, but because AI stole the narrative, Trump's grift tainted the industry, and traditional finance may be suppressing prices through derivative shenanigans. The path forward requires winning battles on multiple fronts: regulatory clarity, genuine use cases, and resisting both government overreach and internal corruption.
Extreme Fear: Lower Than FTX
Bitcoin's sentiment hit a five — worse than any prior crash.
The Doubt: Why Crypto Feels Broken
No blowups this cycle, yet sentiment is worse than ever.
Unlike previous bear markets, no major crypto firm has collapsed this cycle — no BlockFi, no Three Arrows Capital, no FTX. Yet the fear and greed index is at historic lows. The industry is experiencing a crisis of doubt rather than a crisis of solvency. Long-time believers who held 80–100% of their net worth in crypto are making permanent allocation shifts away from the asset class.
The reasons are multifaceted: the four-year cycle is in its down phase, quantum computing fears linger, Trump's use of crypto for personal enrichment has cast a shadow over the industry, MicroStrategy's troubles are mounting, and wrench attacks are on the rise. Most damaging of all, AI and robotics have stolen crypto's thunder as the hot narrative. The industry's front-page coverage is dominated by grift and scams, not innovation.
Crypto won its regulatory battles — Gary Gensler is gone, the SEC is friendlier, the Clarity Act is on the table — but those victories no longer serve as catalysts. Instead, the industry now faces a new problem: association with Trump's corruption has turned half the political spectrum permanently hostile. Meanwhile, genuine use-case adoption remains elusive, and the market is pricing in the possibility that crypto's best days are behind it.
The Uncertainty: Tariffs and AI Tail Risk
Markets can't price what they can't predict.
Jane Street: The Villain Crypto Wants
Accused of rigging Terra Luna's collapse and suppressing Bitcoin today.
May 7, 2022: Terra Labs Withdraws Liquidity Terraform Labs pulled $150 million of TerraUSD from the Curve 3pool, claiming it was a routine transfer. This was non-public information.
10 Minutes Later: Jane Street Exits Wallets associated with Jane Street removed $85 million of TerraUSD from the same pool. The peg became fragile.
May 8–10: Terra Collapses TerraUSD fell to 97 cents, then 75 cents, then 13 cents over three days. Jane Street is accused of insider trading and precipitating the crash.
2026: The 10 a.m. Bitcoin Drop Jane Street is now accused of suppressing Bitcoin's price through daily Tradfi hedging activities involving IBIT, creating synthetic supply and undermining the 21 million cap.
«AI is so bullish that it's bearish»
Viral doomer scenario spooked markets, but it's fanfiction.
“AI is so bullish that it's bearish and everyone's going to lose their job.”
Zach XBT Exposes Axiom
Meta Revives Zuck Bucks
Stablecoin RFP targets three billion users across Facebook, Instagram, WhatsApp.
Meta has issued a request for proposal (RFP) to integrate a stablecoin into its ecosystem — Facebook, Instagram, and WhatsApp — reaching potentially three billion users. This is a revival of the 2019 Diem project, which was crushed by Elizabeth Warren and Congress after Mark Zuckerberg was grilled for attempting to create Facebook's own currency on its own blockchain. The original vision was a basket of fiat currencies; the new plan is far more modest: a dollar-pegged stablecoin.
Stripe is the hottest candidate to win the RFP, given that its founders sit on Meta's board of directors and Stripe has Tempo infrastructure purpose-built for this use case. The most compelling application is remittances through WhatsApp, which could replace Venmo-style payments and unlock stablecoin flows in emerging markets. While this is a Tradfi-adjacent move — likely custodied on private rails like Tempo rather than fully public blockchains — it represents a major step toward the trillion-dollar stablecoin market and could force competitors like Twitter, TikTok, and Telegram to follow suit.
The Pentagon's AI Ultimatum
Anthropic resists demands for mass surveillance and autonomous weapons access.
The Pentagon's AI Ultimatum
Secretary of War Pete Hegseth gave Anthropic an ultimatum: remove guardrails preventing mass surveillance of US citizens and fully autonomous weapons, or lose its $200–300 million Pentagon contract. Anthropic has not yet backed down, holding to its AI safety commitments. But this is a prisoner's dilemma: if Anthropic refuses, xAI or Google will simply take the contract and the funding, leaving Claude behind. Vitalik Buterin urged Dario Amodei to «honorably eat the consequences,» but the coordination trap is brutal — and China has no such guardrails.
New Moves in Crypto Infrastructure
Securities Mentioned
People
Glossary
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