Bitcoin Faces Continued Struggles as Tariffs Shake Markets, Gold Solidifies Safe-Haven Status
Bitcoin (BTC) is grappling with a notable pullback, down more than 5% since President Trump’s tariff announcement on Wednesday evening sent shockwaves through global markets. Despite its reputation as “digital gold” and a hedge against economic instability, Bitcoin is falling short of its potential as a safe haven, while traditional assets like gold continue to outperform in times of market stress.
Bitcoin’s recent decline mirrors broader market turbulence, with U.S. stock indices — the Nasdaq and S&P 500 — hitting new lows for the year. Bitcoin, however, has managed to stay above its year-to-date low of $75,000, which some analysts view as a sign of relative strength. “This could be a turning point,” said Joel Kruger, a market strategist at LMAX Group. “Bitcoin’s role as a store of value is becoming more apparent, especially as people look for alternatives during times of uncertainty.”
However, not everyone is convinced that Bitcoin is living up to its potential in volatile times. Javier Rodriguez Alarcon, the chief commercial officer at XBTO and former Goldman Sachs executive, questioned Bitcoin’s ability to act as a hedge against market turmoil. “Despite the narrative, Bitcoin still shows a strong correlation with traditional risk assets,” said Alarcon. “During periods of uncertainty, we’re seeing Bitcoin move alongside equities, not as a safe haven.”
Gold, on the other hand, is solidifying its position as the preferred store of value. According to JPMorgan, gold continues to benefit from the global currency debasement trade, driven in part by the ongoing trade tensions and tariffs. “While Bitcoin’s volatility raises questions about its role as digital gold, gold remains the clear beneficiary,” said Nikolaos Panigirtzoglou, an analyst at JPMorgan. The bank’s reports also pointed out that Bitcoin’s price is still comfortably above its estimated production cost of $62,000, but gold’s stability and lower volatility make it the go-to asset in uncertain times.
At the time of writing, gold is trading at $3,126 per ounce, just shy of its all-time high of $3,200, while Bitcoin struggles to hold above $80,000. Despite this, some investors are holding out hope that Bitcoin could eventually decouple from traditional markets and establish itself as a true hedge against inflation and geopolitical risk.
For now, though, gold remains the go-to asset for risk-averse investors, while Bitcoin’s volatility continues to raise doubts about its status as a safe haven in periods of global uncertainty.
