April 2 is set to be a significant turning point in international trade legislation. The President of the United States has referred to it as “Liberation Day,” marking the day new tariffs of over 20% will be imposed on imports from more than 25 nations. Reports indicate that the administration is also contemplating “broader and higher tariffs” beyond this initial set, suggesting that April 2 is unlikely to bring an end to economic instability.
In the past week, markets have shown a negative response, with the S&P 500 declining by 3.5% and the Nasdaq 100 falling by 5%, reflecting growing investor concerns. Conversely, gold prices surged by 4%, hitting an all-time high of over $3,150 per ounce. Meanwhile, the yield on the 10-year Treasury fell to 4.2%, despite recent inflation figures indicating a rise in some core components.
This market behavior is a classic indication of a risk-averse environment, often a precursor to economic downturns.
Amidst the volatility, Bitcoin (BTC) dropped by 6%. While this decline is relatively moderate compared to its historical fluctuations, it does not yet establish it as a reliable hedge. However, its increasing recognition as a reserve asset hints that this could evolve over time.
### Bonds and Gold Drive the Flight to Safety
During times of macroeconomic and geopolitical unrest, investors typically gravitate toward yield-bearing and historically stable assets. The declining yield on U.S. government bonds paired with rising gold prices indicates a growing appetite for such assets.
Gold is currently enjoying a remarkable surge. In the last two months, gold funds have attracted over $12 billion in net inflows, marking the largest influx of capital into this asset class since 2020.
Since the beginning of the year, gold prices have climbed nearly 17%, while the S&P 500 has seen a 5% decline. This disparity highlights a precarious economic situation, further evidenced by a significant drop in U.S. consumer sentiment, which has plummeted around 20 points to levels not observed since 2008. In March, only 37.4% of Americans anticipated a rise in stock prices over the coming year, a decrease of nearly 10 points from February and 20 points down from the peak in November 2024.
As noted by some analysts,
> “An economic slowdown has clearly begun.”
### Bitcoin: Digital Gold or Tech Proxy?
A recent analysis indicates that BlackRock’s spot Bitcoin ETF is currently 70% correlated with the Nasdaq 100, a level reached only a couple of times in the past. This correlation suggests that macroeconomic factors continue to influence Bitcoin’s short-term movements, similar to tech stocks.
Data from the ETF shows a shift. Following a week of strong inflows, spot Bitcoin ETFs experienced a net outflow of $93 million on March 28. The total assets under management for Bitcoin ETPs have dipped to $114.5 billion, the lowest level seen in 2025.
These figures reveal that Bitcoin is still largely viewed as a speculative tech proxy rather than a stable reserve asset. Nonetheless, signs indicating a potential transition are starting to emerge.
### Bitcoin is on the Journey to Becoming a Reserve Asset
Beneath the fluctuations, a fundamental transition is taking place. Companies are increasingly incorporating Bitcoin and its ETFs to diversify their balance sheets.
Recent data indicates that a significant portion of BlackRock’s ETF shares is owned by public companies and individual investors. Additionally, BlackRock’s recent decision to allocate 1% to 2% of its portfolios to Bitcoin ETFs underscores the growing acceptance by institutional investors.
Data shows that publicly traded companies hold about 665,618 BTC, with private firms possessing around 424,130 BTC. Together, this amounts to effectively over one million BTC—approximately 5.5% of the total supply (excluding coins that are lost). Analysts project that holding BTC as part of corporate treasury management could become the norm by the end of the decade.
An industry partner recently remarked that he predicts a quarter of the S&P 500 will incorporate Bitcoin on their balance sheets as a long-term asset by 2030.
The essence of any asset is shaped by the perspectives of its holders. As more corporations look to Bitcoin for treasury diversification and as sovereign nations experiment with Bitcoin reserves, the cryptocurrency’s stature is evolving. The U.S. Strategic Bitcoin Reserve, while imperfect, contributes to this ongoing trend.
It’s premature to label Bitcoin as a fully established hedge. Its value is still mainly influenced by short-term speculation. However, the shift is beginning. As adoption grows among nations, corporations, and individuals, we may see a decrease in Bitcoin’s volatility and an increase in its use as a partial hedge.
For the moment, the notion of Bitcoin as a safe haven may remain aspirational. Yet, if current trends persist, it may not be long before that changes.
> This article does not offer investment advice or recommendations. All investments involve risks, and individuals should conduct their own due diligence before making decisions.