Crypto Market Faces Uncertainty as Tariff Tensions Escalate

The cryptocurrency market has been in turmoil since February, when the U.S. announced tariffs on Canada, Mexico, and China. Major cryptocurrencies have taken a hit, with some plunging more than 20%. Now, with “Liberation Day” on April 2 approaching—the date when reciprocal tariffs from various nations are expected to take effect—investors are bracing for further instability. How will Bitcoin, Ethereum, and XRP react to the unfolding tariff saga?

Bitcoin: A Risky Bet Amid Policy Chaos

At first glance, Bitcoin should be immune to the effects of tariffs. Unlike fiat currencies, it is not tied to any single nation. The initial belief was that Bitcoin might even benefit as a hedge against economic uncertainty.

But the market hates unpredictability. And that’s exactly what the ongoing tariff battle has created.

• Investors are growing wary of Bitcoin because of the uncertainty surrounding economic policies.
• Tariff announcements, revisions, and retaliatory measures have led to a risk-averse sentiment.
• Bitcoin has declined 10% since February, despite strong support from the Trump administration.

With no clear resolution in sight, Bitcoin’s price movements will likely remain volatile in the coming weeks.

Ethereum Takes the Hardest Hit

Ethereum has suffered the most under the weight of tariff concerns. Since February 1, it has plunged 20%, and there are no clear signs of a turnaround.

Why is Ethereum being hit harder than Bitcoin? The answer lies in its dual identity—both a cryptocurrency and the backbone of blockchain projects.

The uncertainty surrounding global trade is impacting investments in blockchain-based applications. Investors are hesitant to fund new projects amid economic turbulence, which is putting Ethereum’s ecosystem at risk.

One sentence sums it up: If developers and investors are unsure about future regulations and economic conditions, they won’t commit capital to Ethereum-based projects.

XRP Shows Resilience, But For How Long?

Unlike Bitcoin and Ethereum, XRP has been relatively stable. It has gained 2% since February, largely thanks to regulatory clarity after the SEC dropped its lawsuit against Ripple.

But this could be misleading. Some analysts argue that XRP’s stability stems more from relief over regulatory hurdles than immunity to tariffs. Moving forward, the question remains: Will XRP continue to defy the broader market downturn, or will it eventually succumb to the same pressures affecting its peers?

What Happens After April 2?

April 2 could be a defining moment for cryptocurrencies. The Trump administration’s “Liberation Day” tariff measures could shape market sentiment for months to come.

A few key points to watch:

• If the tariffs lead to further economic uncertainty, expect Bitcoin and Ethereum to struggle.
• XRP could hold its ground if cross-border transactions remain steady.
• Market correlation with traditional equities is tightening, meaning crypto may move more in sync with stock markets.

The only certainty at this point? More volatility is on the horizon.