The cryptocurrency market could be on track for a recovery as investors began to stabilize following President Donald Trump’s announcement of drastic tariffs.
Trump announced his mutual import duties on April 2, which sent trembling across the global market. According to Reuters, the S&P 500 lost more than $5 trillion on record, the biggest drop on record.
Still, some analysts are looking at the silver lining in their tariff announcements.
“In my opinion, tariffs are an expression of uncertainty in the market,” Michaël Vande Poppe, founder of MN Consultancy, told Cointelegraph. “The day of liberation is essentially the peak of that period and the climax of uncertainty. It’s now public. Everyone knows a new playing field.”
Van de Poppe added that he believes Trump is using tariffs, a strategic move to stimulate domestic growth and reduce harvests. “Tax is literally the only way to do that,” he said. “I wouldn’t be surprised if they could turn it around within the next six to 12 months.”
Average tariff rates for US goods and imports. Source: JPMorgan, Ayesha Tariq
President Trump’s plan imposes a 10% baseline tariff on all US imports from April 5, and a “mutual tariff” of up to 54% in certain countries with greater trade obstacles since April 9.
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Import duties can cause supply mitigation
Still, the end of uncertainty could lead to new investments in the crypto market and lead to a recovery, Van de Poppe said:
“We will begin to see a rotation into the crypto market in the coming period when investors start buying dips and realising that some things are undervalued.”
He said the economic impact of tariffs could ultimately lower the US Federal Reserve and launch a new round of new quantitative easing (QE).
Arthur Hayes, co-founder of Maelstrom’s BitMex and chief investment officer of Maelstrom, predicts that once the Fed officially enters the QE cycle, Bitcoin can rise to $250,000.
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Trump’s tariff uncertainty still places emphasis on emotions
According to Noelle Acheson, author of The Crypto Is Macro Now Newsletter, tariff-related uncertainty could continue to pressure your risky asset desire for weeks.
“We can expect President Trump to change his mind several times within the first few weeks,” Acheson told Cointelgraf. She added:
“With increasing uncertainty in these markets, we can expect more risk-off behavior, despite some short-term bounces potentially providing some relief.”
“In the case of crypto, BTC continues to act like a risky asset in the short term, with analog counterparts banging highs one after another,” says developments that could affect crypto investors’ feelings in the short term.
Meanwhile, Crypto Intelligence Firm Nansen estimated the 70% chance that the market will be at the bottom by June, depending on how tariff negotiations evolve.
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