Crypto investors expected a surge in demand as traditional markets reacted to U.S. President Donald Trump’s newly confirmed tariffs. However, instead of turning to digital assets, investors have flocked to gold and silver, leaving Bitcoin and altcoins struggling.

Tariff Impact on Crypto Markets

Trump’s tariffs aim to boost domestic production by making foreign goods more expensive. While this could strengthen the U.S. economy in the long run, it also introduces several risks, such as rising consumer prices, economic slowdowns, and potential trade wars as other nations retaliate.

Since the tariff confirmation, Bitcoin has dropped by at least $5,000, with most altcoins also in the red. Santiment’s on-chain analytics suggest that the crypto market is reacting differently than anticipated, as investors appear hesitant to view digital assets as a hedge against economic instability.

Despite the timing of the announcement—strategically made after stock market hours on April 2 to limit immediate panic—Wall Street is still expected to experience a sell-off. Global stocks have already taken a hit, and U.S. futures indexes are declining.

Will Crypto See a Turnaround?

Many analysts believed that market uncertainty would drive investors toward crypto as an alternative store of value. However, gold and silver have emerged as the preferred safe havens. Gold has surged 20% over the past three months, reaching approximately $3,190, while Bitcoin has remained closely correlated with the S&P 500. Altcoins have fared even worse, showing deeper losses.

While the current climate appears bearish, some analysts argue that the situation presents a long-term opportunity. As global economies adjust, some expect the tariffs to eventually lead to bullish momentum in crypto, with countries lowering their tariffs against the U.S. Others, however, warn of a prolonged period of market turbulence for both stocks and digital assets.

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EightCap, your trusted Partner in CFDs, Cryptocurrencies and Stocks.