Preface

This report summarizes key policy developments and macro events in the Web3 industry during January 2025. It covers major global economic and crypto market events, including economic data releases, policy shifts, and industry developments. The analysis spans crucial indicators—from the U.S. Manufacturing PMI to Federal Reserve monetary policy and cryptocurrency regulations—significantly impacting market participants and policymakers. By examining these key events, we aim to help readers better understand the current economic landscape and its potential future trajectory.

TL;DR

• January 2 – The U.S. releases the Manufacturing Purchasing Managers’ Index (PMI).
• January 9 – Federal Reserve meeting minutes: Inflation will continue slowing, but Trump administration policies may increase price pressure risks.
• January 10 – Ethereum and Solana staking are no longer classified as collective investment schemes in the UK.
• January 14 – The U.S. reports the New York Fed’s 1-year inflation expectation for December at 3%, compared to the previous 2.97%.
• January 14 – The U.S. reports the December PPI annual rate at 3.3%, slightly below the market expectation of 3.4%, marking a new high since February 2023.
• January 15 – The U.S. reports the unadjusted December CPI annual rate at 2.9%, in line with market expectations.
• January 20 – Trump’s inauguration speech does not mention cryptocurrency, causing significant fluctuations in the crypto market.
• January 21 – Trump nominates Caroline Pham as acting Chair of the Commodity Futures Trading Commission (CFTC).
• January 22 – Trump announces a $500 billion AI project in collaboration with three major tech giants.
• January 30 – Federal Reserve Chair Jerome Powell holds a press conference on monetary policy.

Timeline

Key Developments and Updates

January 2 – U.S. Releases Manufacturing Purchasing Managers’ Index (PMI)

On January 2, 2025, the U.S. Manufacturing Purchasing Managers’ Index (PMI) increased slightly from 46.5 in the previous month to 48.4. Although manufacturing activity remained in contraction, price levels rose, indicating a potential gradual economic improvement. The final reading of the December S&P Global Manufacturing PMI stood at 49.4, higher than the expected 48.3 and the previous 48.3. While still below the 50-point threshold that separates expansion from contraction, the improvement suggests a slight rebound in manufacturing activity. Trump’s tariff and tax cut policies objectively support inflation, which may impact manufacturing costs and influence the PMI figures. Additionally, the federal fiscal pressure is increasing, with interest payments on debt significantly driving up the federal deficit, potentially affecting economic policies and the PMI. [1]

January 9 – Federal Reserve Meeting Minutes: Inflation Expected to Slow, but Trump’s Policies Could Increase Price Pressures

The December meeting minutes of the Federal Reserve indicate a consensus among Fed officials that inflation is likely to continue slowing in 2025. However, as policymakers begin addressing the potential impact of Trump’s incoming administration policies, risks of persistent price pressures are increasing. The minutes noted that participants expect inflation to continue converging toward the 2% target, though some officials highlighted that recent inflation data exceeded expectations. They also expressed concerns that potential changes in trade and immigration policies could prolong the disinflation process. Some participants suggested that the progress in reducing inflation may have temporarily stalled or identified potential risks in the process. The minutes described the December rate cut decision as a “delicate balance,” with some members arguing that keeping borrowing costs unchanged would be preferable given the perceived stagnation in inflation progress.[2]

January 10 – Ethereum and Solana Staking No Longer Classified as Collective Investment Schemes in the UK

The UK Treasury has amended the Financial Services and Markets Act (FSMA), effective January 31, to exclude cryptocurrency staking from the classification of collective investment schemes. With this amendment, staking ETH and SOL will now be considered only as part of blockchain validation processes and will no longer be subject to the strict regulatory requirements of collective investment schemes. Previously, due to regulatory ambiguity, crypto staking faced the risk of being classified under traditional collective investment vehicles, which could have restricted industry growth.

The amendment clarifies that staking fundamentally differs from collective investment schemes, as participants lock up cryptocurrency to validate blockchain transactions and ensure network security. Bill Hughes, legal counsel at ConsenSys, welcomed the change, calling it a significant industry advancement. The move aligns with the UK’s strategic approach to fostering crypto innovation while ensuring market protection.[3]

January 14 - U.S. New York Fed Reports December 1-Year Inflation Expectations at 3%, Previous Value at 2.97%

The New York Federal Reserve’s Center for Microeconomic Data released its December 2024 Survey of Consumer Expectations. Short-term inflation expectations held steady, while medium-term expectations rose and long-term expectations fell. The survey showed declining expectations for unemployment, voluntary job exits, and the likelihood of finding work after job loss. One-year household income growth expectations dipped slightly to pre-pandemic levels, though spending growth expectations increased and remained well above pre-pandemic figures. The median one-year inflation expectation stayed at 3%, while the three-year expectation increased from 2.6% to 3%, and the five-year expectation dropped from 2.9% to 2.7%. The rise in three-year inflation expectations was uniform across demographic groups, though the decrease in five-year expectations was mainly driven by respondents under 40, particularly those with a high school education or less.

Home price growth expectations increased 0.1 percentage points to 3.1%, staying within the 3% to 3.3% range established in August 2023. Food price expectations increased by 0.2 percentage points to 4%, while other commodity expectations declined. Gas price expectations fell 0.7 percentage points to 2% — the lowest since September 2022. College education costs dropped by 1 percentage point to 5.7%, medical costs decreased 0.2 percentage points to 5.8%, and rent expectations fell 0.2 percentage points to 5.5%. [4]

January 14 - U.S. December PPI Annual Rate at 3.3%, Below Market Expectations of 3.4%, Highest Since February 2023

On Tuesday, the U.S. Bureau of Labor Statistics announced that the December Producer Price Index (PPI) annual rate was 3.3%, below the expected 3.4% but higher than the previous 3% reading, marking the highest level since February 2023. PPI is a leading indicator for CPI and comprises a significant portion of the overall CPI. A lower-than-expected PPI reading typically negatively impacts the dollar, as it suggests manufacturers are struggling to pass increased costs to consumers, possibly due to weak demand or intense competition. The latest PPI data indicates that CPI is likely to remain moderate. CPI is considered crucial for Federal Reserve monetary policy decisions in the coming months. With the job market remaining resilient and economic growth steady, the U.S. Core inflation may only cool slightly by the end of 2024, supporting the Fed’s stance on slowing the pace of rate cuts. [5]

January 15 — U.S. December CPI Annual Rate at 2.9% Matches Market Expectations

The U.S. Bureau of Labor Statistics reported that the Consumer Price Index (CPI) rose 2.9% year-over-year in December, up from November’s 2.7%. Core CPI (excluding volatile food and energy costs) increased 3.2% year-over-year, down from November’s 3.3%. Monthly CPI rose 0.4%, compared to November’s 0.3%. Core CPI increased 0.2%, lower than November’s 0.3%. According to FactSet consensus, economists had expected a monthly consumer price increase of 0.3% and an annual inflation rate of 2.8%. Core inflation was projected to rise 0.2%, with the annual rate remaining 3.3%. [6]

January 20 - Trump’s Inaugural Speech Omits Cryptocurrency, Causing Market Volatility

In his inaugural speech, U.S. President Trump concentrated on economic recovery and immigration policy, not mentioning Bitcoin or cryptocurrencies. The crypto market reacted significantly, resulting in $824 million in liquidations within 24 hours. While some had anticipated Trump’s administration might establish a Bitcoin Strategic Reserve (SBR), former BitMex CEO Arthur Hayes indicated that such a move was unlikely in the current economic and political environment. Trump’s appointments of Mark Uyeda and Caroline Pham to lead the SEC and CFTC, respectively, may shape future cryptocurrency regulation. Though the market showed volatility, Bitcoin demonstrated its resilience by maintaining relative stability. Investors should remain attentive to the new administration’s policy direction, especially concerning potential regulatory changes in cryptocurrency. [7]

January 21 - Trump Nominates Caroline Pham as Acting CFTC Chair

According to Bloomberg, President-elect Donald Trump has nominated current CFTC Commissioner Caroline Pham as acting chair. The CFTC’s five commissioners voted Monday to confirm the nomination. Pham will replace Rostin Behnam until the Senate approves a new permanent chair. [8]

Given her strong support for regulatory clarity in digital assets, Pham’s nomination could positively impact the crypto market. Her proposed “regulatory sandbox” concept would allow businesses to test products and services within a controlled regulatory framework. This approach could foster a more flexible, innovation-friendly environment for cryptocurrencies and digital assets. The balanced stance on innovation and regulation may attract more business and investor participation while establishing guidelines for CFTC’s expanded role in digital assets—potentially leading to greater mainstream acceptance and market stability. However, the market’s response will ultimately depend on Pham’s implemented policies and the broader regulatory landscape’s evolution after she takes office.

January 22 - Trump Announces $500 Billion AI Project with Three Tech Giants

Trump announced a major investment at the White House, forming a joint venture called “The Stargate Project” with Oracle, OpenAI, and SoftBank, planning to invest $500 billion in AI infrastructure. Subsequently, Trump’s key campaign ally Musk attempted to criticize this. Musk wrote on his social media platform X: “They don’t actually have that much money, SoftBank can actually secure far less than $10 billion. I have reliable information on this.” Trump’s plan emphasizes AI development, but the project’s successful implementation remains uncertain. [9]

January 30 - Fed Chair Powell Holds Monetary Policy Press Conference

The Federal Reserve held its monetary policy meeting on January 29, maintaining the current rate of 4.25% to 4.5%. Since July last year, this marks the first instance that the Fed has kept rates steady across four meetings. In its statement, the Fed acknowledged robust economic activity and low unemployment but expressed concern about persistent inflation, notably removing previous language about inflation moving toward the 2% target. Chair Powell emphasized that while economic conditions are favorable, there is no urgency to adjust monetary policy since conditions for rate cuts have not yet materialized.

When asked about Trump’s proposed tariff increases and tax cuts potentially leading to price increases, Powell noted significant uncertainties in the future direction of policies—including tariffs, immigration, fiscal policy, and deregulation—making specific impact estimates difficult. The Fed will evaluate its economic effects once these policies become clearer and will continue monitoring policy developments. [10]

Summary

In January 2025, the global economy and financial markets exhibited dynamic and complex patterns. U.S. manufacturing activity showed signs of recovery despite contraction, while inflation expectations shifted in response to policy changes. The Federal Reserve maintained its cautious monetary stance. In the cryptocurrency sector, regulatory adjustments in the UK created fresh opportunities for industry growth. The Trump administration’s policies on cryptocurrency regulation and AI initiatives added new uncertainties to the market. These interconnected developments affected immediate market performance and established crucial benchmarks for future economic policymaking and market directions.


References:

1. Trading Economics,https://tradingeconomics.com/united-states/manufacturing-pmi
2. Jin10,https://xnews.jin10.com/details/158398
3. CryptoSlate,https://cryptoslate.com/ethereum-and-solana-staking-no-longer-classified-as-collective-investment-schemes-in-the-uk/
4. Federal Reserve Bank of New York,https://www.newyorkfed.org/newsevents/news/research/2025/20250113
5. CNBC,https://www.cnbc.com/2025/01/14/ppi-december-2024-.html
6. MorningStar,https://www.morningstar.com/economy/december-us-cpi-report-shows-inflation-29-annual-rate
7. CBS NEWS,https://www.cbsnews.com/news/transcript-trump-inauguration-speech-2025/
8. Bloomberg,https://www.bloomberg.com/news/articles/2025-01-20/trump-picks-caroline-pham-to-serve-as-acting-cftc-chair
9. CNN,https://edition.cnn.com/2025/01/22/tech/elon-musk-trump-stargate-openai/index.html
10. Jin10,https://rili.jin10.com/day/2025-01-30

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