As the Trump administration announced its tariff policy on Wednesday's "Liberation Day," many people are pessimistic about the overall economy and cryptocurrency prices. However, analysts say there are good reasons to remain optimistic.

Why Trump's Tariff Policy Might Be Beneficial for Bitcoin?

U.S. President Donald Trump signed an executive order on March 26, 2025, in the Oval Office of the White House in Washington, announcing a 25% tariff on all foreign-made cars.

Image source: Win McNamee/Getty Images

For more information:

• Bitcoin prices fell significantly during the Trump administration, contrary to investor expectations.

• Economic uncertainty and tariff policies have driven investors towards safer assets like gold, affecting the crypto market.

• Analysts believe that tariffs may weaken the dollar's dominance, which could be beneficial for Bitcoin in the long run.

• So far, the performance of the crypto market during the Trump administration has been quite different from expectations. Investors had hoped that regulatory reforms and policies such as the Bitcoin strategic reserve would significantly push up prices, but the results have been the opposite. At the beginning of this year, Bitcoin prices were well above the $100,000 mark, but for most of March, they had fallen to a low of around $85,000.

Cryptocurrency prices have been dragged down by their increased correlation with traditional assets such as stocks and bonds, which are being hit by macroeconomic uncertainty. Tariffs - additional charges imposed by the United States on imported goods from other countries - have worried Wall Street about a global economic recession. Crypto investors are moving away from crypto assets because they are seen as relatively high-risk。

"This is all about the market's 'risk appetite,' which continues to deteriorate, creating a temporary split between crypto assets and gold. Gold continues to be the preferred 'safe-haven asset,'" said Marc Ostwald, chief economist and global strategist at ADM International Investment Services。

"This is largely driven by central bank foreign exchange reserve managers who are trying to reduce their exposure to the dollar, which has long been a concern for them。”

As the global financial and trade systems become increasingly fragmented, investors are starting to look for lower-risk asset alternatives, including the dollar. For now, this means turning to gold, which has risen 18% so far this year。

But this could change, according to Omid Malekan, an adjunct professor at Columbia Business School and author of "The Story of Blockchain: An Introduction to the Technology That No One Understands."

"I think the entire future is fraught with uncertainty and, in some ways, unpredictability because there are so many intersecting factors, and both cryptocurrencies and tariffs are new territories. Some people think that cryptocurrencies are just risk-on tech assets that will be sold off due to tariffs. But Bitcoin is seen as 'digital gold' in certain circles, and physical gold is rising rapidly on the news of tariffs. So what will be the outcome?"

In other words, economic uncertainty may drive investors to turn to Bitcoin, much like they have sought out gold in recent months。

Another positive signal is that the impact of tariffs on cryptocurrencies may already be "priced in," and the worst may be over, according to Zach Pandl, head of research at Grayscale (a leading crypto asset management firm)。

President Trump is expected to announce U.S. tariff policies on Wednesday, April 2, at 4 p.m. Eastern Time, known as "Liberation Day."

Pandl estimates that tariffs have already reduced economic growth by 2% this year. But "Liberation Day" may alleviate the most severe pain felt by financial markets。 "If we see a tough but phased statement on Wednesday, and the focus is on the 15 countries they seem to have targeted, I expect the market to rebound on the news," Pandl said in an interview with CoinDesk。

"Once we get past this announcement, the crypto market may refocus on the fundamentals, which are very positive."

Pandl noted that announcements like Circle's IPO would not happen unless institutions are confident in the digital asset sector and related policies。

In addition, Pandl - a former macroeconomist at Goldman Sachs - believes that tariffs will increase demand for non-dollar currencies。

"I think tariffs will weaken the dollar's dominance and create room for competitors, including Bitcoin. Prices have fallen in the short term. But the first few months of the Trump administration have further strengthened my long-term confidence in Bitcoin as a global currency asset."

Despite the current market's pessimism about prices, Pandl still believes that Bitcoin will hit a new all-time high this year。 "If I didn't think Bitcoin would be a long-term winner, I wouldn't have left my Wall Street job," he said。

As the Trump administration announced its tariff policy on Wednesday's "Liberation Day," many people are pessimistic about the overall economy and cryptocurrency prices. However, analysts say there are good reasons to remain optimistic.

Why Trump's Tariff Policy Might Be Beneficial for Bitcoin?

U.S. President Donald Trump signed an executive order on March 26, 2025, in the Oval Office of the White House in Washington, announcing a 25% tariff on all foreign-made cars.

Image source: Win McNamee/Getty Images

For more information:

• Bitcoin prices fell significantly during the Trump administration, contrary to investor expectations.

• Economic uncertainty and tariff policies have driven investors towards safer assets like gold, affecting the crypto market.

• Analysts believe that tariffs may weaken the dollar's dominance, which could be beneficial for Bitcoin in the long run.

• So far, the performance of the crypto market during the Trump administration has been quite different from expectations. Investors had hoped that regulatory reforms and policies such as the Bitcoin strategic reserve would significantly push up prices, but the results have been the opposite. At the beginning of this year, Bitcoin prices were well above the $100,000 mark, but for most of March, they had fallen to a low of around $85,000.

Cryptocurrency prices have been dragged down by their increased correlation with traditional assets such as stocks and bonds, which are being hit by macroeconomic uncertainty. Tariffs - additional charges imposed by the United States on imported goods from other countries - have worried Wall Street about a global economic recession. Crypto investors are moving away from crypto assets because they are seen as relatively high-risk。

"This is all about the market's 'risk appetite,' which continues to deteriorate, creating a temporary split between crypto assets and gold. Gold continues to be the preferred 'safe-haven asset,'" said Marc Ostwald, chief economist and global strategist at ADM International Investment Services。

"This is largely driven by central bank foreign exchange reserve managers who are trying to reduce their exposure to the dollar, which has long been a concern for them。”

As the global financial and trade systems become increasingly fragmented, investors are starting to look for lower-risk asset alternatives, including the dollar. For now, this means turning to gold, which has risen 18% so far this year。

But this could change, according to Omid Malekan, an adjunct professor at Columbia Business School and author of "The Story of Blockchain: An Introduction to the Technology That No One Understands."

"I think the entire future is fraught with uncertainty and, in some ways, unpredictability because there are so many intersecting factors, and both cryptocurrencies and tariffs are new territories. Some people think that cryptocurrencies are just risk-on tech assets that will be sold off due to tariffs. But Bitcoin is seen as 'digital gold' in certain circles, and physical gold is rising rapidly on the news of tariffs. So what will be the outcome?"

In other words, economic uncertainty may drive investors to turn to Bitcoin, much like they have sought out gold in recent months。

Another positive signal is that the impact of tariffs on cryptocurrencies may already be "priced in," and the worst may be over, according to Zach Pandl, head of research at Grayscale (a leading crypto asset management firm)。

President Trump is expected to announce U.S. tariff policies on Wednesday, April 2, at 4 p.m. Eastern Time, known as "Liberation Day."

Pandl estimates that tariffs have already reduced economic growth by 2% this year. But "Liberation Day" may alleviate the most severe pain felt by financial markets。 "If we see a tough but phased statement on Wednesday, and the focus is on the 15 countries they seem to have targeted, I expect the market to rebound on the news," Pandl said in an interview with CoinDesk。

"Once we get past this announcement, the crypto market may refocus on the fundamentals, which are very positive."

Pandl noted that announcements like Circle's IPO would not happen unless institutions are confident in the digital asset sector and related policies。

In addition, Pandl - a former macroeconomist at Goldman Sachs - believes that tariffs will increase demand for non-dollar currencies。

"I think tariffs will weaken the dollar's dominance and create room for competitors, including Bitcoin. Prices have fallen in the short term. But the first few months of the Trump administration have further strengthened my long-term confidence in Bitcoin as a global currency asset."

Despite the current market's pessimism about prices, Pandl still believes that Bitcoin will hit a new all-time high this year。 "If I didn't think Bitcoin would be a long-term winner, I wouldn't have left my Wall Street job," he said。