So far, crypto markets have not acted as expected under the Trump administration. Investors hope that regulation reform and policies such as a bitcoin strategic reserve will bring prices higher. But it’s the opposite. Bitcoin has fallen from those highs of over $ 100,000 at the beginning of the year to a trough at mid 80,000 for most of March.
Crypto prices have suffered from increasingly linked to traditional possessions such as stocks and bonds, which are macroeconomic uncertainty. Tariffs -Surcharges US areas in imports from other countries -Wall Street remembers a global backdown. Crypto investors have become clear in crypto assets, which are seen as somewhat dangerous.
“It’s about ‘risk appetite’ markets that continue to deteriorate, and this time it drives a wedge between crypto and gold assets, which continues to be ‘safe shelter’ selected,” said Marc Ostwald, chief economist and global strategist at Adm Investor Services International.
“(That) in the small portion driven by the managers of the Central Bank FX Reserve, who seeks to reduce USD exposure, which has long been the source of their remembrance.”
As the global financial and trade system becomes more fragmented, investors are looking for alternatives to riskier assets, including dollars. So far, it means turning to gold, which is up to 18% year-to-date.
But that may change, Omid Malekan, an adjunct professor at Columbia Business School, said “The Story of the Blockchain: A guide to a starting technology that no one understands.” Bitcoin can be new gold soon.
“I think the whole (future) is unsure and in some ways unknown, because many crosscurrents and both crypto and tariffs are new. Some people have argued that crypto is a risk-on tech asset and for sale because of tariffs. But Bitcoin has found walking in some circles as ‘digital gold’ and the physicians of the tarapa.
In other words, economic uncertainty can lead to investors to look for bitcoin as they have sought gold in recent months.
Another note of positivity: the impact of crypto tariffs may be “price on” and the worst can be completed, Zach Pandl, head of the Grayscale research, a leading crypto asset management company.
President Trump should announce US tariffs on Wednesday, April 2, 4pm ET – what is known as “Day of release.” According to reports, he will place “rewards tariffs” against 15 countries that provided tariffs against the US, including China, Canada and Mexico.
Pandl estimates tariffs that have now taken 2% of economic growth this year. But the release day can really stop the worst of the pain in the financial markets. “If we saw an announcement (on Wednesday) that was tough but phased, and focused on the 15 countries they seemed to target, my expectation was that the markets would interrupt that news,” Pandl told CoinDesk.
“It is possible that once we get to this announcement, crypto markets can focus on the foundations that are very positive.” Pandl said the announcements As the IPO of the Circle It does not happen if institutions do not have a high level of confidence in the digital assets sector and the rules around it.
In addition, Pandl, a former Macro-economist at Goldman Sachs, believes that tariffs will increase the appetite for non-dollar money.
“I think the tariffs will weaken the dominant role of the dollar and create space for competitors including Bitcoin. Prices have dropped for a short time. But the first few months of the Trump administration have raised my belief in a longer term for Bitcoin as a global finance owner.”
Pendl still believes that Bitcoin will hit new hours high this year, despite current pessimism around prices. “I will not stop my job on Wall Street if I do not think Bitcoin will be the winner of the long term,” he said.
