The crypto market is feeling the heat from global trade tensions, and according to analysts, this pressure isn’t easing up anytime soon. Experts predict that tariff-related concerns will keep markets under strain until at least April 2, with potential relief coming only if a resolution is reached.
Bitcoin’s Struggle Amid Trade War Uncertainty
Since January 20, when President Donald Trump announced import tariffs on Chinese goods, Bitcoin (BTC) has dropped over 17%. Despite positive crypto-related developments, trade war fears have taken center stage, weighing down not only digital assets but also traditional markets.
According to Nicolai Sondergaard, a research analyst at Nansen, tariffs are the biggest factor driving current market movements.
“I’m waiting to see what happens after April 2. If some tariffs are dropped, it could be a huge market catalyst. But that depends on whether global agreements can be reached.”
What’s Next? A Possible Market Turnaround
Sondergaard believes that risk assets like Bitcoin and altcoins may struggle to find clear direction until the tariff situation becomes more stable. He suggests that this uncertainty could last between April and July, meaning investors may need to prepare for more volatility in the short term.
The Federal Reserve’s Role in the Market Slump
Beyond trade tensions, high interest rates set by the Federal Reserve are also keeping investors cautious. Sondergaard explains that the Fed is waiting for signs of real economic distress before making any major rate cuts, which could help fuel a stronger market recovery.
“We need to see clear ‘bad news’ before the Fed moves to cut rates. Until then, risk appetite will remain limited.”
Currently, market predictions suggest there’s an 85% chance that the Fed won’t change interest rates in its upcoming May 7 meeting, according to CME Group’s FedWatch tool.
What Investors Should Watch For
According to Iliya Kalchev, an analyst at Nexo, key economic reports like Consumer Confidence, GDP, jobless claims, and inflation data will play a major role in shaping investor sentiment.
“If inflation cools and the economy remains stable, we could see a boost in investor confidence, which might drive Bitcoin and digital assets higher,” Kalchev noted.
Will April Be the Turning Point?
With tariff decisions, interest rate policies, and inflation reports all converging in the coming weeks, April could be a make-or-break month for the crypto market. Whether Bitcoin and altcoins see a rebound or further declines will largely depend on how these macroeconomic factors unfold.
