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In today’s episode:

• 🗞️ Trump’s Tariff Bomb Drops, Bitcoin Trips Under $84K

• ✍️ Why is Aave One of the Coolest Projects in Crypto

TOP STORY

Trump’s Tariff Bomb Drops, Bitcoin Trips Under $83K

Well, well, well—Donald Trump is back with another tariff tantrum, and this time, it's the European Union feeling the heat.

The U.S. president just slapped a 25% tariff on EU auto imports, pharmaceuticals, and semiconductor chips, calling out the $350 billion trade deficit and vowing to fix what he calls “unfair” EU trade practices.

And just like that, Bitcoin took a nosedive, slipping under the $83,000 mark like a clumsy waiter at a five-star restaurant.

It hit a low of $82,242, probably wondering what it did to deserve this.

Tariff Wars: The Sequel

Trump’s latest tariff rollout—set to go live by April 2, 2025—isn’t just a small tweak.

German and Italian cars are about to get a hefty price hike, jumping from the cozy 2.5% duty rate to a painful 25%.

Pharmaceutical and semiconductor industries? Buckle up, because you’re in for a rough ride, too.

As expected, Europe isn’t thrilled. The EU immediately labeled the tariffs "unjustified", and European Commission President Ursula von der Leyen wasted no time promising a “firm and immediate” response. (Translation: Get ready for some retaliatory tariffs on American goods.)

Even Macron stepped in, flexing his diplomatic muscles, saying the EU will “make itself respected”. (Fancy way of saying, "We’re not taking this lying down.")

Bitcoin Takes a Hit—Again

Traditional markets stumbled upon the news and crypto wasn’t spared either.

Bitcoin didn’t like Trump’s tariff drama one bit, and it dropped 1.20% in the last 24 hours, with $165 million in liquidations—and, unsurprisingly, $118 million of that came from long positions. Ouch.

Could this be a sign of a larger trend? If history is anything to go by, trade wars bring uncertainty, and uncertainty doesn’t always favor risk-on assets like crypto—at least in the short term.

But hey, Bitcoin has survived China bans, SEC lawsuits, and Elon Musk tweets—so what’s a little trade war panic in the grand scheme of things?

What’s Next?

Now, all eyes are on the EU’s next move.

If Brussels fights back with tariffs on U.S. agriculture, motorcycles, and—who knows—maybe even bourbon, we could see more market volatility (and some unhappy Harley riders).

For now, buckle up. With Trump making moves, Bitcoin swinging wildly, and the EU ready to clap back, this could get messy. But hey, at least we’re entertained. 🍿

BREAKDOWN

Why is Aave One of the Coolest Projects in Crypto

Crypto is full of wild ideas, but every once in a while, a project comes along that changes the game.

Aave is one of those projects. It’s not just another lending platform—it’s a financial revolution that flips traditional banking on its head.

Imagine a world where you don’t need a bank to get a loan, where interest rates adjust automatically, and where borrowing a million dollars for a few seconds is just another Tuesday. Welcome to Aave, where finance meets the future.

Aave vs. Traditional Banking: Who Wins?

Ever tried getting a bank loan?

It’s like auditioning for a reality show—tons of paperwork, weeks of waiting, and a verdict that feels more like a judge’s personal whim than a fair decision.

With Aave, your access to capital isn’t based on a credit score but on how much crypto you can put up as collateral.

Need a loan at 3 AM? Aave’s got you. Want to withdraw your funds without waiting for bank hours? Easy. While banks hold onto your money and pay you laughable interest rates, Aave lets you lend and borrow freely.

Of course, DeFi isn’t perfect. Unlike banks, there’s no customer support to rescue you from mistakes, and if your collateral tanks, you won’t get a sympathetic call—you’ll get liquidated. Crypto markets are wild, and interest rates fluctuate way more than your average fixed bank loan. But hey, that’s part of the thrill.

How Aave Works (a.k.a. The Magic Behind the Scenes)

Aave is a decentralized finance (DeFi) protocol that lets users lend and borrow crypto without middlemen. It runs on Ethereum and other blockchains, powered by smart contracts.

• Depositing & Earning Interest: Users deposit assets into Aave’s liquidity pools and earn interest in return. Think of it like a high-yield savings account, but on steroids.

• Borrowing Crypto: Borrowers put up collateral (e.g., ETH to borrow USDC). The amount they can borrow depends on the Loan-to-Value (LTV) ratio.

• Flash Loans: Aave’s mind-blowing feature—borrow huge sums with no collateral, execute a trade, and pay it back instantly in the same transaction. If the loan isn’t repaid within that transaction block, it’s automatically reversed, meaning the loan never actually happened. This is used for arbitrage, liquidation strategies, and more.

• Liquidations & Risks: If your collateral’s value drops too much, Aave will liquidate it to cover your loan. No second chances.

• AAVE Token Utility: Governance, fee discounts, and staking rewards—holding AAVE gives you power in the ecosystem.

Who Should Use Aave?

Lenders: The Crypto Passive Income Crew

Lending crypto on Aave is a great option if:

• You’re a long-term crypto holder looking to earn yield.

• You have stablecoins sitting idle and want to put them to work.

• You’re an institution or whale looking for passive income.

Borrowers: The DeFi Power Users

Need quick liquidity but don’t want to sell your crypto? Aave is your best friend. It’s ideal for:

• Traders leveraging their positions.

• Arbitrageurs capitalizing on price differences with Flash Loans.

• DeFi enthusiasts using borrowed funds for farming and liquidity mining.

• Businesses needing short-term capital without selling assets.

Just remember—borrowing requires collateral, and if your Health Factor drops too low, liquidation will hit faster than a rug pull on a shady altcoin.

The Future of Aave

Aave isn’t just competing—it’s dominating. While MakerDAO focuses on stablecoins and Compound keeps things simple, Aave brings the most features, the most assets, and multi-chain accessibility. Plus, with its upcoming GHO stablecoin, it’s set to shake up DeFi even further.

So, is Aave for you? If you want to earn on idle crypto, take out a decentralized loan, or explore the most innovative tools in DeFi, Aave is one of the best platforms out there. Just remember—DeFi is powerful but risky. Keep an eye on that Health Factor, or your collateral might disappear faster than your paycheck on Black Friday.

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.