Crypto markets are bracing for potential chaos as Bitcoin faces a 70% chance of another price drop, fuelled by fears of U.S. trade policy shifts. Analysts warn April’s tariff deadlines could trigger fresh volatility, echoing March’s correction. Investors now watch Washington closely, fearing a repeat of last month’s sell-off.
Why Tariffs Could Trigger Bitcoin’s Next Price Plunge
The looming threat stems from President Donald Trump’s proposed April 2 tariffs, which rattled markets earlier this year. These policies, aimed at reshaping U.S. trade relationships, sparked recession fears and sent equities and crypto into a spiral. According to blockchain analytics firm Nansen, renewed tariff talks could destabilise Bitcoin’s recovery.
Trade policy uncertainty has pushed the U.S. Economic Policy Uncertainty Index to record highs. Now investors fear tariffs might slow global growth, dampening their risk appetite. “Crypto markets remain hypersensitive to macroeconomic signals,” explains Aurelie Barthere, Nansen’s principal analyst. “Tariffs directly impact investor psychology, triggering sell-offs.”
Analyst Predicts 70% Chance of Post-April 2 Correction
Nansen’s research suggests a 70% likelihood Bitcoin will slide after April 2, potentially revisiting mid-March lows. Barthere notes this correction could last weeks before stabilising. However, she stresses this dip may mark the year’s final bottom, paving the way for a rebound.
“In my main scenario, crypto prices drop post-April 2, then stabilise,” Barthere told. “After that, Bitcoin could rally toward all-time highs.” She attributes this optimism to strong U.S. growth and accelerating crypto adoption. Still, she cautions a 30% chance exists that March’s lows were the bottom or a fleeting “dead cat bounce.”
Trade Policy Threatens to Prolong Market Uncertainty
Market anxiety may linger through June, warns Nansen. While Treasury Secretary Bessent noted progress in trade barrier negotiations, Trump’s mixed signals and floating tariff exemptions add confusion. Barthere argues uncertainty could peak during Q2, coinciding with U.S. tax cut debates.
Bitcoin’s correlation with equities remains strong. Any stock market slump from trade wars might drag crypto down. “Investors are treating Bitcoin as a risk asset,” Barthere says. “Tariff headlines will sway both markets similarly.”
No Recession in Sight
Despite turbulence, hard data suggests resilience. The U.S. flash PMI hit 53.5 in March, signalling 1.9% annualised growth. Though Q1 growth slowed to 1.5%, Barthere highlights stable employment and consumer spending. “Sentiment surveys look bleak, but real activity hasn’t collapsed,” she notes.
Bitcoin ETFs also show strength, with seven straight days of inflows, which is a first since January. This signals institutional confidence, contrasting retail investor fears. “The dip is being bought,” Barthere observes. “That’s a bullish sign long-term.”
Bull Market Intact? Why Optimism Persists Beyond the Dip
Nansen’s report insists Bitcoin’s bull run isn’t dead. Regulatory progress and institutional adoption in the U.S. underpin this view. Barthere adds that absent a recession, crypto could thrive. “Markets are correcting within a bull cycle,” she says. “We’ll likely bottom post-correction, then climb.”
History shows crypto often rebounds sharply after policy-driven sell-offs. With tariff clarity expected by mid-year, analysts urge patience. “Volatility is inevitable,” Barthere concludes, “but the trajectory still points up.” For investors, April’s storms may offer a buying opportunity before calmer seas and new peaks emerge.
Written By Fazal Ul Vahab C H
