Bitcoin (BTC) Market Cap Dips 3.3% to $2.78T After Trump's New Tariffs

The cryptocurrency market cap dropped 3.3%, falling from $2.88 trillion to $2.78 trillion, after U.S. President Trump imposed reciprocal tariffs on numerous nations

U.S. President Donald Trump's imposition of reciprocal tariffs on numerous nations has sparked a 3.3% decline in the cryptocurrency market cap. The total market cap fell from $2.88 trillion to $2.78 trillion.

The tariffs, which are affecting 185 countries and could push the S&P 500 into a bear market with an estimated $2 trillion lost rapidly, have sparked volatility across global markets as investors now scramble to find stability.

Among the movements in the crypto market, Bitcoin's price dipped as the broader market faced volatility from Trump's new tariffs. Bitcoin briefly neared $88K before retreating below $82K.

However, is this a short-term shake-up or could Bitcoin be poised to strengthen further as a hedge against economic instability?

Analyst Divide: Correction or Breakout Trigger?

Experts are speculating on Bitcoin's future trajectory amid the macro chaos. BitMEX founder Arthur Hayes predicts more turbulence, with a crucial test ahead.

“If $BTC can hold $76.5k btw now and US tax day, April 15, then we are out of the woods. But if it cannot, then more pain is coming. Don’t get chopped up!”

In a contrasting opinion, trader Michael Van de Poppe sees the tariff fallout as the “ultimate trigger” for Bitcoin to break above $87K and push towards new all-time highs.

However, analysts' predictions vary widely, with one analyst suggesting a drop to $75K and another targeting $120K by Q4 2025. This signals significant volatility in the coming months.

Related: Analyst Who Called Bitcoin Tops Warns of Potential Correction to $75,000

Bitcoin’s Role: Hedge Potential vs. Risk Asset Reality

Trump's tariff moves have also brought the focus back to traditional markets.

The S&P 500 is still struggling to regain stability, which could ultimately bolster crypto's narrative as a hedge against broader economic instability. The key question is whether Bitcoin can persevere through this storm or will it succumb to strong sell-off pressure.

While BTC initially saw a slight rally today, which some speculate could be linked to Bitcoin's narrative as “digital gold” in times of economic uncertainty, its price later pulled back.

This showcases that risk assets like crypto often remain highly correlated with broader market volatility in the short term. These macroeconomic fears and trade tensions are driving the market trends.

These tariffs could also have an impact on the U.S. dollar's dominance in the long term, which might benefit Bitcoin as an alternative asset. But in the near term, the crypto market is likely to face choppy conditions as investors remain cautious to assess the economic and trade implications.