- Bitcoin tumbled to $91,000 and then rebounded amid Trump’s short-lived tariff gambit.
- In the long run, Bitcoin will develop as a haven asset, said Noelle Acheson.
- Other experts share insights on how Bitcoin will fare under Trump.
As Bitcoin bounces back from the market turmoil after President Trump’s short-lived tariff threat on Canada and Mexico, the pain is far from over.
“It feels like markets are still figuring out what’s going on with China and whether or not we’ll be going through this again in a month,” Noelle Acheson wrote in her “Crypto Is Macro Now” newsletter on Tuesday.
“The crypto mood still feels somewhat depressed, despite the strong regulatory shifts and development moves.”
Bitcoin suffered a dizzying drop to $91,500 after Trump announced a 25% import tariff on Canada, and Mexico, and a 10% duty on China. The price has since recovered to $100,000, though the jitters wiped out $2.3 billion from the crypto market.
Hedge funds had anticipated big stock declines long before Trump’s moves, Bloomberg reported, with portfolio managers dumping US equities for five weeks straight.
Here’s what SkyBridge Capital CEO Anthony Scaramucci, research firm Kaiko, and other experts say will happen to Bitcoin amid rising global tension.
Analyst Noelle Acheson
“If this tariff scare blows over soon, that will be good for risk assets including Bitcoin,” Acheson wrote.
But if it doesn’t end quickly, Acheson said, it will also be good. Safe haven assets such as Bitcoin can benefit from investors looking to hedge themselves against local currency depreciation — and prepare for a new economy moving forward.
Even so, a lot of Bitcoin’s success is riding on the strength of the US dollar.
“A dropping US dollar relative to other currencies would be good for global liquidity and conceivably reawaken risk appetite, benefitting BTC and stocks,” she wrote.
SkyBridge Capital’s Anthony Scaramucci
“We’ll see short-term turbulence from the president’s erraticism,” Scaramucci said on X. Bitcoin and crypto are long-term winners, but “you have to sit for the full Trump buffet.”
The head of SkyBridge capital is all-in on crypto. His firm holds $1.4 billion in digital assets, representing 57% of the company’s entire assets under management.
And Scaramucci? Over 60% of his personal wealth is in Bitcoin.
A lot of the momentum is riding on Trump, for good and for bad.
“If you get full-on institutional adoption, where a bank is allowed to custody crypto, hold it on its own balance sheet, use its capital to be a principal investor in crypto, maybe even just bitcoin, I think that would be a very big, powerful move,” he told the Financial Times.
Coinstash’s Mena Theodorou
Expect more volatility, said Mena Theodorou, co-founder at crypto exchange Coinstash.
Even though Trump has paused the tariff war, investors remain spooked and searching for safety, he told DL News.
“Tariffs of this scale are generally seen as negative for risk assets like Bitcoin and other cryptocurrencies,” he said.
Gold soared to an all-time high today, while the US dollar index surged to a yearly high.
Nevertheless, Trump also brought light at the end of the tunnel, according to Theodorou.
The President signed an executive order that would create a US sovereign wealth fund that might include digital assets.
Kaiko Research
Crypto is in a tricky situation, according to analysts from Kaiko research.
Short-term funding rates — often serving as a gauge of market sentiment — are low, which suggest investors are struggling to find a clear direction.
Meanwhile, expirations on options at the end of the month show a balance. According to Kaiko analysts, this means traders are betting the volatility will be short-lived.
But with Trump, an investor never knows.
“He’s like a toddler, kind of testing his limits,” Adam McCarthy, analyst at Kaiko, told DL News.
Bitwise’s Jeff Park
According to Jeff Park of Bitwise, Trump’s endgame is to try to weaken the US dollar without boosting long-term interest rates. To do so, he’s playing the tariff card — forcing countries to reduce their dollar reserves.
If he can pull it off, “there’s no asset better positioned than Bitcoin,” Park wrote to investors on February 3. Lower rates will spark the risk appetite of US investors, sending prices higher.
But what if the US finds itself in the throes of a sustained tariff war?
Park predicts that the resulting economic weakness will lead to money printing — “and historically, such a stimulus has been extraordinarily good for Bitcoin.”
Market movers
- Bitcoin is down 0.6% in the past 24 hours to $98,915.
- Ethereum is up 3.3% over the same period to $2,803.
What we’re reading
- Why devs say Uniswap’s v4 launch will kick start Ethereum’s ‘DeFi renaissance’ — DL News
- Guys, is ETH OK? — Milk Road
- How I almost got slaughtered in a pig butchering crypto scam — Unchained Crypto
- The worst day of liquidations (ever) — Milk Road
- Indexed Finance hacker charged in US for alleged $65m theft — DL News
Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.