Bitcoin’s price has struggled to maintain momentum in 2025, with the flagship cryptocurrency falling from highs above $100,000 to around $85,000 for much of March. Despite initial optimism about the Trump Administration’s stance on crypto, factors like rising tariffs and macroeconomic uncertainty have dampened investor sentiment.
Crypto Market Hit by Tariff Fears
The crypto market’s decline is largely correlated with traditional financial assets, which have been rattled by President Donald Trump’s trade policies. Investors fear that tariffs imposed on key trade partners could trigger a global economic slowdown, driving risk-averse behavior and pushing money into safer assets like gold instead of Bitcoin.
Marc Ostwald, Chief Economist at ADM Investor Services International, explains:
“Markets’ risk appetite continues to deteriorate, pushing investors toward gold rather than crypto, which remains a volatile asset class.”
Gold has surged 18% year-to-date, with central banks reducing their exposure to the U.S. dollar. Some analysts believe Bitcoin could soon emerge as a digital alternative to gold, but uncertainty remains.
Will Bitcoin Become the New Digital Gold?
Omid Malekan, a professor at Columbia Business School and author of “The Story of the Blockchain,” believes that while Bitcoin has been trading like a risk asset, it may eventually gain favor as a safe-haven:
“Bitcoin has found footing in some circles as ‘digital gold.’ If economic uncertainty worsens, investors may turn to BTC just as they’ve turned to physical gold.”
The long-term potential of Bitcoin remains strong, even as short-term price action remains weak. Some industry experts argue that the negative impact of tariffs may already be priced in, which could set the stage for a market rebound.
Trump’s Tariffs and Bitcoin’s Long-Term Outlook
President Trump is set to announce new U.S. tariffs on April 2 at 4 p.m. ET—dubbed “Liberation Day.” Reports suggest that the U.S. will impose reciprocal tariffs on 15 countries, including China, Canada, and Mexico.
Zach Pandl, head of research at Grayscale, believes the upcoming announcement could mark a turning point:
“If we see a phased and targeted approach, markets could rally. Once this uncertainty clears, crypto could refocus on fundamentals, which are very strong.”
Pandl also argues that tariffs could reduce the dominance of the U.S. dollar, making room for alternative monetary assets like Bitcoin. Institutional interest remains strong, as evidenced by Circle’s upcoming IPO, which signals confidence in the long-term viability of digital assets.
Bitcoin’s Path Forward—Will It Hit New Highs?
Despite the current downturn, Pandl remains optimistic about Bitcoin’s future:
“I still believe Bitcoin will hit new all-time highs this year. The long-term case for Bitcoin as a global monetary asset has never been stronger.”
With ongoing economic uncertainty and increasing institutional adoption, Bitcoin’s role in the global financial system is still evolving. Whether BTC continues to act as a risk-on asset or solidifies itself as digital gold remains to be seen.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are volatile and risky. Always conduct your research before making any investment decisions.
