The ongoing global trade conflict could serve as a beneficial factor for Bitcoin’s increasing status as a safe-haven asset alongside gold, primarily due to its superior liquidity and ease of access compared to traditional precious metals.
Financial markets have experienced turmoil since the announcement of reciprocal import tariffs by the U.S. President on April 2, which resulted in unprecedented sell-offs in conventional stock markets and led to Bitcoin (BTC) dropping below $75,000.
While gold still holds its position as the primary refuge for investors amid geopolitical tensions, experts suggest that Bitcoin’s digital characteristics and around-the-clock liquidity are drawing renewed attention from the market.
“Investors are seeking to preserve value away from U.S. assets, yet they are hesitant to hold other nations’ currencies or debts because those may be even weaker and prone to devaluation,” a crypto asset manager noted recently. “What emerges is Bitcoin—an asset that cannot be devalued, is not governed by any country, and can be acquired immediately.”
Despite the rising enthusiasm for Bitcoin, gold is likely to maintain its stronghold as the favored asset, at least for the foreseeable future, as pointed out by a principal research analyst from a crypto intelligence platform. This expert added, “Bitcoin shows promise, but its volatility remains significant; its ascendance will likely be gradual. The Chinese central bank has been decreasing its U.S. Treasury holdings while increasing its gold reserves for years, and I foresee this trend continuing irrespective of the crypto narrative.”
On April 9, China’s Finance Ministry introduced new tariffs, which could be as high as 84% on U.S. imports, effective April 10, in retaliation for the tariffs imposed under the U.S. administration. Analysts believe that a resolution could mitigate uncertainty and rekindle interest in riskier assets such as cryptocurrencies.
The recent tariffs implemented by China are a direct response to the 34% tariff on Chinese imports announced by the U.S., effective April 9.
Some analysts view the ongoing global tariff negotiations as a form of strategic maneuvering aimed at reaching an agreement with China, a development that may alleviate global trade uncertainties and result in a recovery of risk assets, including cryptocurrencies.
China and Russia reportedly utilizing Bitcoin for trade settlements
Certain countries are already making strides towards leveraging cryptocurrencies for settlement in international trade.
According to a recent note from a digital asset research head, “It has been reported that China and Russia have begun using Bitcoin and other digital assets to settle some energy transactions. This indicates that Bitcoin is evolving from merely a speculative investment to a viable monetary instrument.”
Other notable instances include Bolivia’s plans to import electricity using cryptocurrencies and a French utility company’s exploration of harnessing surplus energy for Bitcoin mining.
These developments showcase an increasing interest in alternatives to current financial frameworks, particularly among nations looking to circumvent reliance on the U.S. dollar.
Earlier reports have also suggested that Russia is utilizing Bitcoin and stablecoins for international oil transactions to bypass global sanctions.
The changing “volatility profile” of Bitcoin suggests a progression towards it becoming a safer asset, highlighting the cryptocurrency’s gradual transition from being seen as risky to a more stable store of value. While current tariff-related uncertainties may dampen risk tolerance during negotiations, positive developments could spark renewed interest in crypto markets.
“As conditions stabilize, we can expect to see a shift towards cryptocurrencies, with investors starting to capitalize on undervalued opportunities,” remarked the founder of a consultancy dedicated to market analysis.