As the Trump Administration prepares to unveil its latest tariff strategy on “Liberation Day” this Wednesday, many market watchers are bracing for economic turbulence — and a continued slump in crypto prices. But some analysts suggest that the fear may be overblown, and that Bitcoin could, in fact, benefit in the long run.
Crypto markets have behaved unpredictably since Trump returned to office. Many investors anticipated that deregulatory moves and proposals like a Bitcoin Strategic Reserve would fuel a price rally. Instead, Bitcoin has retreated from early-year highs above $100,000 to hover in the mid-$80,000 range throughout March.
Part of the problem, analysts say, is that cryptocurrencies have become increasingly correlated with traditional financial markets. As stocks and bonds have wavered under economic uncertainty, crypto has taken similar hits. Wall Street is now on edge over looming tariffs — import taxes targeting foreign goods — which some fear could tip the world economy toward recession. As a result, investors have been cautious, avoiding riskier assets like crypto.
“This is really about risk appetite in the markets, which continues to decline,” said Marc Ostwald, Chief Economist and Global Strategist at ADM Investor Services International. “That’s putting distance between crypto assets and traditional safe havens like gold, which remains the go-to option.”
Ostwald also pointed to central banks, particularly FX reserve managers, shifting away from the U.S. dollar, a trend that could benefit alternative assets in the long run.
For now, gold has taken the spotlight, rising 18% year-to-date. But Bitcoin could soon follow, says Omid Malekan, adjunct professor at Columbia Business School and author of The Story of the Blockchain.
“The future is uncertain — both tariffs and crypto are relatively new factors in the global economy,” Malekan said. “Some argue Bitcoin is still seen as a risky tech asset and will decline as tariffs increase. But it’s also being embraced as ‘digital gold,’ and the physical version is soaring right now on tariff fears. So which narrative wins out?”
His point: growing economic uncertainty could eventually shift investor sentiment toward Bitcoin, just as it has recently for gold.
There may also be hope that the worst is already behind the crypto market. According to Zach Pandl, Head of Research at Grayscale, some or all of the impact from tariffs may already be priced in.
President Trump is expected to announce new U.S. tariffs on Wednesday, April 2, at 4 p.m. ET — dubbed “Liberation Day.” Reports indicate he’ll introduce “reciprocal tariffs” on 15 countries, including China, Canada, and Mexico, in response to their own trade barriers.
Pandl estimates that tariffs have already shaved about 2% off U.S. economic growth this year. Still, he believes that Wednesday’s announcement could help calm markets. “If the plan is firm but rolled out in phases, targeting those 15 countries, we could see markets actually rally in response,” he told CoinDesk.
“If that happens, crypto investors might be able to refocus on fundamentals, which remain very strong,” he added.
One such positive signal is the planned IPO of Circle, a major crypto company — something Pandl says wouldn’t be happening if institutions lacked faith in digital assets and the policies surrounding them.
Pandl, who previously worked as a macroeconomist at Goldman Sachs, also believes the tariff shift will weaken the dollar’s global dominance and open the door for alternatives like Bitcoin.
“Tariffs may hurt in the short term, but they highlight the need for non-dollar stores of value,” he said. “Bitcoin fits that role better than most. I’m more convinced than ever that it’s a long-term winner.”
Despite the current price lull, Pandl remains confident that Bitcoin will set new all-time highs before the year is out. “I wouldn’t have left Wall Street if I didn’t believe Bitcoin was the future,” he said.
