The Bitcoin price’s resilience amidst the ongoing equity market correction has caught significant attention. However, experts warn that BTC’s stability in the face of equity market correction is short-lived. As Matrixport highlighted, Bitcoin is expected to mirror stock market movements following Donald Trump’s tariff announcements.
In a recent X post, crypto financial platform Matrixport shed light on Bitcoin’s correlation with the stock market. Though the pioneer cryptocurrency remained resilient amid the prevailing equity market downturn, analysts predict a possible market shift in the near future.
Notably, analyst Markus Thielen expects the Bitcoin price to track stock market movements in light of Trump’s upcoming tariff announcement. This could bring increased volatility to the market.
Currently, Bitcoin’s funding rates are only marginally positive, and retail trading volumes have dropped to summer 2024 lows. This trend suggests a cautious investor sentiment, with traders hesitant to make significant moves. As a result, analysts predict Bitcoin price will move in line with equities, presenting both opportunities and challenges for traders. However, considering the current market positioning, a significant beta-driven reaction seems unlikely.
For context, Donald Trump is set to unveil the tariff plans today. This strategy may include reciprocal tariffs targeting 15 countries, including China, Canada, and Mexico.
Significantly, Trump’s potential move is expected to impact the crypto market, with assets like Bitcoin feeling the heat. The introduction of tariffs has pushed investors away from risk assets like cryptocurrencies, deepening the correlation between digital asset and traditional assets like stocks and bonds. Commenting on the matter, CoinPanel CEO Aran Hawker stated,
Macro-driven correlations are increasingly shaping price action in major cryptos. The Nasdaq’s role as a lead indicator in the current risk-off move offers a useful benchmark for attributing parallel weakness across the digital assets market.
Bitcoin has been experiencing a rollercoaster ride over the past few weeks, hitting an all-time high of $108k and plummeting below $80k. Considering the strong correlation between Bitcoin and stock markets, analysts predict that BTC is poised for a major downturn following Trump’s tariff plans.
Nonetheless, others argue that the tariff strategy could bolster Bitcoin price’s long-term growth. According to Columbia Business School professor Omid Malekan, BTC could emerge as an alternative to traditional safe havens like gold. He noted, “Bitcoin has found footing in some circles as ‘digital gold’ and the physical variety is soaring on the tariff news.”
Malekan’s statement comes in contrast with BTC critic Peter Schiff’s dismissal of the crypto’s title as the digital gold. Citing Bitcoin’s volatility and inherent threats, Schiff addressed it as a digital risk.
Veteran trader Peter Brandt is now bullish on Bitcoin, Ethereum, XRP, and XLM after earlier…
Binance said it will compensate users affected by Friday night’s massive crypto selloff that caused…
Fundstrat's analyst Mark Newton is doubling down on their Ethereum prediction of a rally above…
Raoul Pal, the founder of Real Vision, has reaffirmed his bullish stance on the crypto…
XRP ETF issuers have filed amendments for their respective registration statements, providing optimism even as…
Today's crypto market crash triggered major congestion at some of the top centralized exchanges like…