Impact of Trump’s Trade War on the Cryptocurrency Market Ahead of April 2 Tariffs
Concerns over a global trade war, particularly regarding impending tariffs from President Trump, are pressuring both cryptocurrency and traditional markets. Bitcoin has declined 18% amid these worries, with investor sentiment decreasing further following aggressive tariff discussions. Despite this, large Bitcoin holders continue to accumulate, maintaining steady institutional interest in the midst of market volatility.
As discussions of a global trade war escalate, both traditional and cryptocurrency markets are facing heightened pressures, particularly ahead of a potential tariff announcement from US President Donald Trump scheduled for April 2. This move could significantly influence Bitcoin’s price movements throughout the month. Trump initially declared import tariffs on Chinese goods during his inauguration on January 20.
Concerns surrounding tariffs have intensified inflation worries, thus diminishing investor interest in risk assets. Data from TradingView indicates that Bitcoin experienced an 18% decline, while the S&P 500 index observed a fall of over 7% during the two months following Trump’s first tariff announcement. According to Stella Zlatareva, dispatch editor at Nexo, “Going forward, April 2 is drawing increased attention as a potential flashpoint for fresh US tariff announcements.”
Investor sentiment was further impacted on March 29 when Trump urged his advisers to adopt a more assertive approach to import tariffs, signaling a possible escalation of the trade conflict, as reported by the Washington Post. The pending announcement on April 2 is anticipated to elaborate on trade tariffs that target major US trading partners, aiming to address the nation’s approximate $1.2 trillion goods trade deficit and enhance domestic production.
Despite these challenges, Bitcoin whales—large holders of Bitcoin—have shown resilience, maintaining their accumulation strategies. Notably, this group, which possesses between 1,000 to 10,000 BTC, has increased from 1,956 addresses at the start of the year to over 1,990 by March 27, although this remains below the previous cycle’s peak. Iliya Kalchev from Nexo states, “Risk appetite remains muted amid tariff threats from President Trump and ongoing macro uncertainty.”
Though the recent 10-day accumulation streak of US spot Bitcoin ETFs ended on March 28 due to significant outflows from Fidelity’s ETF, analysts are cautiously optimistic about Bitcoin’s prospects for late 2025. Predictions for Bitcoin’s price range widely, from $160,000 to beyond $180,000, showcasing an underlying confidence in its long-term potential despite short-term volatility concerns.
In summary, the looming tariffs anticipated on April 2 are inciting considerable anxiety in both cryptocurrency and traditional markets, particularly affecting Bitcoin’s valuation. While inflationary pressures are curtailing investor appetite, large Bitcoin holders, known as whales, continue to accumulate assets. Optimism remains regarding Bitcoin’s future price potential, despite the existing market volatility and uncertainty surrounding trade policies. While the trade war’s impact on financial landscapes is palpable, continued institutional demand for Bitcoin signals a potentially robust recovery ahead.
Original Source: cointelegraph.com
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