Bitcoin may be headed for a surprising turnaround, even as the crypto market reels from a steep drop following President Donald Trump’s intensified trade policies. While BTC recently fell below $76,000, industry experts believe this pullback could set the stage for long-term gains — especially if the U.S. Dollar continues to falter.
Trade War Sparks Short-Term Panic, Long-Term Crypto Potential
President Trump’s decision to slap an additional 50% tariff on Chinese goods — bringing the total to a staggering 104% — sent shockwaves through global markets. Bitcoin followed suit, dipping sharply, while U.S. equities erased trillions in market capitalization. However, some analysts argue that this dip may be temporary and could ultimately favor Bitcoin’s future as a non-sovereign reserve asset.
Binance CEO Richard Teng weighed in on X, saying the current macroeconomic chaos is pushing investors toward alternative stores of value. “We’re seeing increased interest in crypto, particularly Bitcoin, as a hedge against monetary and geopolitical instability,” Teng noted. “Periods like this often accelerate adoption of decentralized, non-governmental financial systems.”
Crypto as a Reserve Asset? The Dollar’s Dominance Under Threat
Matt Hougan, CIO of Bitwise Asset Management, believes Bitcoin is poised to benefit if confidence in the U.S. Dollar erodes further. He referenced a recent speech by Steve Miran, Chair of the White House Council of Economic Advisers, who pointed out that America’s global reserve currency status contributes to trade imbalances and artificially boosts dollar demand.
“If the dollar starts to decline under pressure from trade wars and fiscal policies, Bitcoin could become an attractive alternative,” Hougan said in a memo. “We may be entering a new monetary era — moving from a single dominant reserve currency to a diversified system where Bitcoin and gold play a much larger role.”
Fed Response Could Be the Catalyst for the Next BTC Rally
According to VanEck’s Head of Digital Assets Research, Mathew Sigel, the Federal Reserve’s upcoming moves could be pivotal. If tariffs squeeze U.S. GDP without reigniting inflation, the Fed may opt to cut interest rates. This, in turn, could restore the liquidity conditions that previously propelled Bitcoin to all-time highs.
“Lower interest rates and monetary easing have historically been bullish for Bitcoin,” Sigel noted. “If economic growth slows due to trade policy, Bitcoin could be seen not just as a speculative asset — but a safe haven.”
Market Shake-Up: Stocks Tumble, Crypto Repositions
Tuesday’s market reaction was harsh. The S&P 500 lost 6% intraday, erasing over $2.5 trillion in market value, before trimming some of its losses by the close. Bitcoin mirrored the turbulence, but crypto veterans believe the narrative is shifting.
As global trade fragmentation deepens and traditional monetary systems strain under pressure, Bitcoin may step into a role few imagined just a few years ago — that of a credible global reserve asset.
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