Bitcoin investors may not directly perceive it, but BTC has held up well since President Trump’s tariff announcements led to drastic declines in traditional financial markets. Despite significant declines post-Liberation Day on April 2, Bitcoin’s downtrend has been limited to just 8%.
“I think this is the most bullish 8% drawdown I’ve ever seen in bitcoin,” said Zach Pandl, head of research at Grayscale, a prominent crypto investment firm.
Based on past trends, Bitcoin is expected to be three times more volatile than the Nasdaq, Pandl observed. Yet, while the Nasdaq plummeted 15% early on April 8 compared to April 2, Bitcoin’s performance was significantly more stable.
In essence, the mild 8% drop is seen as a positive outcome, given expectations of a sharper decline based on historical volatility.
Pandl expressed that cryptocurrency investors have cause for optimism due to this slight pullback. He noted that while tariffs may pose short-term risks, they could ultimately drive Bitcoin adoption.
The outlook for Bitcoin looks favorable, especially in an environment where the U.S. dollar might be losing its status as the primary global reserve currency.
“Stagflation will adversely affect stocks and bonds, and historically, it has favored scarce commodities. Investors concerned about stagflation are looking for alternative assets, including Bitcoin,” Pandl remarked.
He indicated that Bitcoin’s stability indicates a shift of investment focus from large tech stocks to commodity-like assets such as Bitcoin. This is reflected in its strengthened performance against the Roundhill “Magnificent 7 ETF.”
Subscribers to Bitcoin’s value proposition as a hedge in turbulent times should feel reassured, especially as the last week’s events have demonstrated its capacity to thrive when the dollar is under pressure.
Pandl believes one’s confidence in Bitcoin as a safe investment should have increased following recent developments. He projects that Bitcoin’s price will rise in the medium term, potentially reaching new all-time highs this year.
“The price of Bitcoin may have dipped, but conviction is rising, and our medium-term price expectations remain unchanged.”
