Bitcoin continues to decline due to April, waiving most of its first quarter profits as global markets respond to escalating trade tensions between the US and China.
The move, led to the US trade war, comes amid a wider relication of assets, with Treasury yields falling, oil collapse and stocks enter the realm of corrections.
The above post-term chart captures the acute market response since President Trump announced on April 2 that he wiped out trade penalties and the announcement of China’s response to 84% tariffs on US goods.
Within a few days, oil prices fell 20.92%, SPY fell 10.23%, and Bitcoin fell 7.34%. Bond prices have also fallen, with US10 and CN10 down 2.42% and 2.58% respectively, reflecting upward pressure on yield.
In many cases, gold, a traditional safe haven, has withdrawn 2.83%, indicating that liquidity stress and risk-off emotions are dominant across asset classes.
Bitcoin’s relative position is less than spy and oil, but more than bonds and gold, indicating that despite the story of strategic reserves, it remains partially connected to broader macrovolatility under acute market stress.
Since Donald Trump’s election won, their overall performance solidifies Bitcoin’s relative resilience.
Since the US election in November 2024, Bitcoin has increased by 11.51%, while gold has been closely carried over at 11.09%. Both assets hold ground as traditional markets have been sharply relicated. Spy has dropped by 14.42%, and oil prices collapse by more than 20%, highlighting widespread macrostress.
Meanwhile, the US and China 10-year bonds (US10 and CN10) fell by 5.11% and 1.72% respectively, consistent with expectations for sustained inflation or increased issuance.
BTC correlation with macros is deepened
Bitcoin’s performance since Trump’s inauguration was initially tracked in a supportive policy environment.
Public support for crypto adoption, spare tokenization, and re-illumination initiatives has contributed to the bullish narrative of the entire digital asset.
However, the latest data shows that Bitcoin transactions are primarily traded along risk assets, rather than decoupling from risk assets.
Recent sales across spies and reversal of Treasury yields reflect changes in expectations. The market is beginning to grow slower, consume more and more defensively positioned. Yale’s Budget Lab forecasts a 0.9 percentage point decline in real GDP in 2025, with the average household expected to incur an additional $3,800 from the tariff system.
Despite favourable long-term policy framing, Bitcoin has not escaped the volatility that has been linked to global liquidity and demand concerns. Facility allocators appear to be reducing exposure to encrypted beta-sensitive assets as the odds of the recession increase.
JPMorgan currently brings the chances of a global recession to 60% from 40% before its April announcement. Goldman Sachs has raised its US-specific forecast to 45%. JPMorgan’s annual letter warned that long-term tariffs could contribute to sustained inflation, asset volatility and lower investment trust.
Global Bond branch narrows the safe haven window for Bitcoin
While the US Treasury yields have been reversed sharply, China’s sovereign debt market reflects a variety of stress signals. China’s 10-year yield fell to 1.65%, down 65 basis points from the previous year.
Trading economics data also show consistent yield reductions on the 2Y, 5Y, and 30Y curves. These moves mean limiting deflationary pressures, weak external demand and the potential for domestic growth rebounds.
As reported by CITI, China’s GDP forecast has been reduced from 4.7% in 2025 to 4.2%, which is significantly higher than the current 2.4% growth in the US, with a 3% decline. Caiyuan Securities is dragging growth by percentage, with US tariffs reducing China’s exports by almost a third, reducing total exports by 4.5%.
However, in both the Western and Chinese sovereignty curves, Bitcoin’s role as a global reserve hedge becomes more complicated.
Institutional portfolios may refrain from discretionary allocation until liquidity is stable or policy clarification returns.
Bitcoin’s framing as a reserve-grade digital commodity continues to resonate with some of the domestic crypto ecosystem, but implementation remains unknown. For now, investors seem to be looking at macro signals more than political signals.
Bitcoin outlook in the context of recession risk
The structural narrative surrounding Bitcoin as a geopolitical hedge, inflation buffer, or programmable reserve asset remains.
However, during periods of macrostress, correlations tend to increase across all risk markets. The latest price action shows that Bitcoin is not considered a risk-off asset under forced liquidity.
The BTC could still find a tail of the policy if the administration accelerates Bitcoin and native initiatives, introduces digital Treasury issuances, or formalises sovereign Bitcoin Holdings. Until then, market participants are trading assets through a macro lens. Price action is closely tied to risk conditions, modeling recession, and cross-asset liquidity.
Brent crude has been down more than 20% since late March, narrowing forward spreads and increasing surplus prices. Consumer cuts, lower export demand, and pressure on manufacturing margins all supply the broader market relik.
Bitcoin remains sensitive to these shifts as part of the broader allocation spectrum.
Bitcoin from the start of the year is actually one of the worst assets, only the second oil.
The divergence shows how Bitcoin and gold have so far absorbed the volatility of the trade war more effectively than the oil, stock or sovereign debt markets, suggesting that Bitcoin is drawing out relative strength even as global liquidity deteriorates.
However, there will not be a 16% increase in assets that can be compared to gold in 2025.
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(TagStoTRASSLATE) Bitcoin (T) China (T) US (T) Analysis (T) Function (T) Macro
