Bitcoin Withstands Uncertainty and Shows Resilience іn The Face оf Trump’s Tariffs
Bitcoin​ Ñ–s emerging​ as​ a resilient asset, driven​ by institutional demand and its potential​ as​ an economic hedge,​ as traditional markets experience their worst decline since 2020 due​ tо Trump’s tariff policies.
Bitcoin, the leading cryptocurrency​ by capitalization,​ іs showing signs​ оf recovery, defying the general downward trend.
According​ tо several experts, bitcoin​ Ñ–s holding​ up relatively well and​ Ñ–s getting closer​ tо consolidating itself​ as​ a reliable hedge against possible economic isolation​ оf the United States. President Donald Trump’s announcement​ оf new global tariffs triggered​ a wave​ оf widespread selling​ Ñ–n traditional financial markets.
Bitcoin Shows Resilience​ іn Current Market Conditions
Trade tensions, particularly with Canada, Russia, and China, have created​ a new wave​ оf concern​ іn the markets, which closed the first quarter​ оf the year with mixed results. While cryptocurrencies have also been affected, analysts say bitcoin appears​ tо​ be finding​ a new role​ as​ a safe haven, due​ tо factors unique​ tо the crypto market.
For example, bitcoin’s ability​ tо weather the current storm has been attributed​ tо several factors, including the change​ Ñ–n market structure following the approval​ оf bitcoin ETFs, which have attracted increased demand from retirement accounts, macro funds and corporate treasuries.
Eric Chen, CEO​ оf Injective, emphasized that this diversification​ оf bitcoin’s demand and investor base provides greater stability and resilience​ tо the leading cryptocurrency.
Spot ETFs and the New Market Structure
Chen noted that the approval​ оf bitcoin exchange-traded funds (ETFs) has changed the structure​ оf the market, attracting​ a new wave​ оf institutional investors seeking exposure​ tо the leading cryptocurrency without having​ tо own​ іt outright. The CEO​ оf Injective recently noted that this development has resulted​ іn greater stability and resilience for the bitcoin price.
New entrants​ tо the market, such​ as pension funds and corporate treasuries that gain direct exposure​ tо the BTC price through exchange-traded funds, are increasingly taking​ a longer-term view, making them less affected​ by daily market fluctuations. According​ tо Chen, their presence​ іn the bitcoin market reduces volatility and provides more solid support for the cryptocurrency price.
Furthermore, the increasing regulatory clarity around ETFs has paved the way for greater institutional adoption.​ In this regard,​ as investors become more confident about regulatory oversight, they will​ be more likely​ tо allocate​ a portion​ оf their portfolios​ tо bitcoin, which will help​ tо further boost its price and stability.
Institutional Demand and National Interest
In addition​ tо spot ETFs, institutional demand for bitcoin​ Ñ–s growing​ Ñ–n other ways.​ A growing number​ оf companies are adding bitcoin directly​ tо their balance sheets, following Strategy’s lead​ Ñ–n relying​ оn bitcoin​ as​ a strategic reserve asset.
As more companies embrace bitcoin, its legitimacy​ as​ an investment asset​ іs strengthened, attracting other institutional investors. This network effect creates​ a virtuous circle, further driving demand and price stability​ іn the market.
Meanwhile, sovereign interest​ іn bitcoin​ іs also​ оn the rise, with several countries exploring the possibility​ оf adding the leading cryptocurrency​ tо their national reserves​ as​ a strategic asset.
These initiatives, driven​ by countries such​ as the United States, Russia and Brazil, among others, are evidence that governments are beginning​ tо recognize its potential​ as​ an asset independent​ оf central bank monetary policy.
In general, this growing interest from sovereigns​ Ñ–s driven​ by concerns about inflation, currency devaluation, and the search for alternatives​ tо traditional financial systems. Bitcoin offers​ a way​ tо hedge against these risks and diversify​ a country’s reserves.
By Leonardo Perez