Bitcoin (BTC) Market Will Face the Aftershocks of a Deep-rooted Economic Storm Until April

The specter of tariffs has been looming since January. The announcement by Donald Trump on Chinese imports triggered a 17% drop in bitcoin.

Crypto markets will be facing the aftershocks of a deep-rooted economic storm until April. An explosive mix of geopolitical tensions and rigid interest rates is stifling risk appetite. But behind this chaos lie opportunities. Decoding.

Trade wars: a predictable but devastating cyclone for the crypto market

The specter of tariffs has been looming since January. The announcement by Donald Trump on Chinese imports triggered a 17% drop in bitcoin.

However, this is just a prelude. Nicolai Sondergaard, an analyst at Nansen, highlights that fears related to trade barriers remain “the main driver” of the markets.

A persistent blockage until April 2, a key date when reciprocal tariffs could come into effect. Crypto assets, although disconnected from traditional economies, cannot withstand this systemic pressure.

Investors are fleeing volatile assets, seeking refuge in caution. Ironically, every rebound in bitcoin is ephemeral, stifled by anxiety-inducing macroeconomic news.

“Resolving trade tensions could be a major catalyst,” Sondergaard elaborates. But the horizon remains clouded.

China, the United States, and the EU are playing a game of chess where each tariff move shakes the markets.

Cryptos, seen as a safe haven during previous crises, are temporarily losing this status. Capital is freezing, awaiting a sign of easing. Between sanctions and countermeasures, the political calendar now dictates the pace of prices.

Interest rates: the Fed’s vise is tightening

In parallel, American monetary policy adds a layer of complexity. The Fed’s high interest rates are suffocating risk appetite. “The Federal Reserve is waiting for real bad news to lower its rates,” explains Sondergaard. A paradox: investors hope for economic slowdown to see signs of easing.

The probabilities of a status quo during the May FOMC meeting are nearing 85%. A clear signal: the priority is still fighting inflation, despite recession risks.

For Iliya Kalchev, an analyst at Nexo, this rigidity is only temporary. “Stabilized economic data could reignite enthusiasm for bitcoin,” he estimates. But the timeline is tight.

The upcoming releases — GDP, unemployment claims, PCE index — will be scrutinized like oracles.

A decline in inflation would pave the way for more lenient rates, bringing some color back to cryptos. In the meantime, the market digests a reality: money is expensive, and speculative investments are paying cash for this reality.

April promises to be a pivotal month. Between the possible activation of tariffs and hopes for a Fed pivot, cryptos are navigating between challenges and opportunities. Seasoned investors know that these storms forge markets.

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Fascinated by Bitcoin since 2017, Evariste has continuously researched the subject. While his initial interest was in trading, he now actively seeks to understand all advances centered on cryptocurrencies. As an editor, he strives to consistently deliver high-quality work that reflects the state of the sector as a whole.