Bitcoin's Safe-Haven Appeal Grows Amid Trade War Uncertainty

Bitcoin’s appeal as a safe-haven asset has been growing amidst the uncertainty caused by the global trade war. The digital currency’s liquidity and accessibility advantages over traditional safe-haven assets like gold have made it an attractive option for investors seeking to protect their wealth during geopolitical stress.

Financial markets have experienced significant volatility since US President Donald Trump announced reciprocal import tariffs in April. This led to record-breaking sell-offs in traditional stock markets and a correction in Bitcoin’s price below $75,000. Despite this, analysts have noted that Bitcoin’s digital nature and 24/7 liquidity are driving renewed interest in the cryptocurrency as a safe-haven asset.

Hunter Horsley, CEO of crypto asset manager Bitwise, highlighted the appeal of Bitcoin in an April 9 post. He noted that investors are looking for assets that cannot be debased and are not controlled by any single country. Bitcoin, with its decentralized nature and immediate possession capabilities, fits this description perfectly. This has led many investors to turn to Bitcoin as a means of storing value outside of traditional financial systems.

While Bitcoin’s growing recognition as a safe-haven asset is promising, gold is likely to remain the dominant refuge for investors, especially in the near term. Aurelie Barthere, principal research analyst at Nansen crypto intelligence platform, noted that Bitcoin is still quite volatile and may gradually gain more traction as a safe-haven asset. She also pointed out that the People’s Bank of China has been increasing its gold reserves for years, a trend that is expected to continue regardless of the crypto narrative.

China’s Finance Ministry announced new tariffs of up to 84% on US imports as a retaliatory measure against Trump’s policy. Analysts believe that a resolution to the trade war could reduce uncertainty and reignite appetite for risk assets like crypto. Some industry analysts view Trump’s global tariff negotiations as a form of posturing aimed at reaching an agreement with China, which could end global trade uncertainty and see risk assets such as crypto recover.

Some nations are already taking steps toward using crypto assets for settlement in global trade. China and Russia have reportedly begun settling some energy transactions in Bitcoin and other digital assets. This development reflects a growing interest in neutral settlement rails, especially among economies looking to bypass the US dollar. Other examples include Bolivia’s plans to import electricity using crypto and French utility firm EDF’s exploration of using surplus power to mine Bitcoin.

Bitcoin’s evolving volatility profile also points to its gradual maturation from a risky asset to a safe-haven asset. While the tariff uncertainty will continue to limit risk appetite during the negotiations, positive developments could bring renewed investment into crypto markets. Michaël van de Poppe, founder of MN Consultancy, predicted that investors will start to buy the dip and understand that some things have been undervalued as the markets calm down.