Bitcoin Fluctuates Amid US-China Trade War Tensions
Bitcoin traded in a tight range on Wednesday, as global financial markets struggled to digest the latest wave of US trade tariffs and China’s retaliation. After briefly climbing 1.1% in early trading, the leading cryptocurrency slipped 1.3% to $76,046 by mid-morning in New York.
This seesaw movement mirrors the broader volatility triggered by President Donald Trump’s new tariffs and China’s response, which sent US equity futures tumbling by 2% and rattled global bond markets.
Bitcoin Resilience vs Traditional Markets
Despite the pullback, Bitcoin has outperformed traditional assets this week. Unlike equities, digital tokens are not directly affected by tariffs. The crypto market remains supported by moderate leverage and a regulatory environment more favorable under the Trump administration.
“Investors are waking up to Bitcoin’s value proposition as a hedge during global turmoil,” said Joel Kruger, strategist at LMAX Group.
Crypto Acts as a Hedge in Tumultuous Times
As stocks and bonds sold off, Bitcoin and other cryptocurrencies offered rare stability. Though Bitcoin remains 30% below its January all-time high, its relative resilience in this volatile environment has reignited the hedge asset narrative.
The digital asset’s behavior is encouraging some investors to consider portfolio diversification strategies that include crypto, especially when traditional hedges like gold and Treasuries are under pressure.
Volatility Persists Despite Growing Institutional Interest
That said, crypto’s path forward is far from smooth. According to Sean McNulty of FalconX, traders are increasingly betting on downside moves, especially in Ether and Solana. A wave of put options hit the market overnight, suggesting bearish sentiment lingers.
“People seem to have given up on a major crypto recovery in the first half of the year,” said McNulty. He added that Bitcoin’s next key support level is near $65,000, a potential target if macro tensions persist.
Short-Term Uncertainty, Long-Term Conviction?
While near-term headwinds weigh heavily, the longer-term outlook for Bitcoin remains rooted in its decentralized appeal and growing institutional adoption. Many in the space view current volatility as part of a broader trend of maturing price action, not a breakdown.
As geopolitical and economic shocks continue to reverberate, Bitcoin’s role as a digital hedge asset will likely be tested — and possibly strengthened — in the months ahead.