Bitcoin is currently valued at $79,150, reflecting a slight 1.8% increase over the past 24 hours, though it’s still down approximately 4% over the last week. These recent price fluctuations occur amid escalating global trade tensions and new tariffs introduced by President Donald Trump. These tariffs, targeting various nations, have contributed to increased market volatility. While stock markets have suffered significantly—with the S&P 500 declining by 12% from April 2 to April 8—Bitcoin’s downturn during the same timeframe has been much less pronounced. This has led analysts to reconsider Bitcoin’s connection to traditional financial markets.
Zach Pandl, Grayscale’s head of research, pointed out that Bitcoin’s smaller-than-anticipated decline, in the face of substantial volatility, signifies its increasing detachment from conventional financial markets. Typically, Bitcoin’s volatility is roughly three times that of the S&P 500. Therefore, a 12% decline in stocks would generally predict a 36% drop in Bitcoin. However, the cryptocurrency only experienced a decrease of about one-third of that projection. Pandl indicated that the tariffs are a direct shock to stock markets rather than to Bitcoin, and that the volatility seen in traditional markets, as represented by the VIX index, is now akin to that of Bitcoin’s options market.
Grayscale contends that the prevailing macroeconomic landscape—characterized by rising inflation, dwindling GDP, and geopolitical unpredictability—could foster a conducive environment for assets like Bitcoin. They draw parallels to the stagflation period of the 1970s, noting that while stocks and bonds lagged, gold prices soared. Bitcoin, often termed “digital gold,” might assume a similar role today, despite lacking the extensive historical background that gold possesses.
The ongoing trade war is also impacting currency markets. A declining U.S. dollar, resulting from tariffs and changing global alliances, may incentivize countries to diversify their reserve assets. Although Iran is presently the only nation whose central bank recognizes Bitcoin as a reserve asset, some sovereign wealth funds have begun to invest in it. Reports indicate that the U.S. is considering the establishment of a Strategic Bitcoin Reserve, highlighting the increasing interest in Bitcoin at the governmental level.
Solo Bitcoin miners are gaining traction as well. Recently, an individual successfully mined a block and earned 3.125 BTC (approximately $259,637 at that time), demonstrating that smaller participants can still achieve occasional success within the network.
While Bitcoin briefly soared past $82,000 following a 90-day tariff hiatus for non-retaliating countries, it remains 26% below its all-time peak of $109,114. Analysts continue to exercise caution. Nic Puckrin from Coin Bureau remarked that the temporary relief does not address the underlying trade issues. Although short-term sentiment remains fragile, long-term trust in Bitcoin continues to be robust.
