Coingecko: Who influenced the April encryption market? How will BTC perform?

Author: Bobby Ong, Coingecko; Translated by: Tao Zhu, Jinse Finance

I hope you buy on the dip when the panic reaches its peak!

This year, every significant drop in the stock market has been due to President Trump’s trade policies. On April 2nd, known as “Liberation Day,” Trump pressured global trade and imposed astonishing tariffs on every U.S. trade partner, with the harshest tariffs targeting China.

This move immediately dealt a heavy blow to the financial markets, and the cryptocurrency market was also impacted. It wasn’t until severe issues arose in the bond market that Trump was forced to retract his position on April 9 (less than 24 hours after the tariffs took effect), shifting to impose a 10% tariff on all countries globally and suspending the “liberation day” tariffs for 90 days. Unsurprisingly, this brought about a “whiplash effect,” and after a relatively calm period, the market returned to a state of “waiting.”

Currently, the most actively traded asset is undoubtedly gold, which is a historically significant volatility hedge and safe-haven asset. Gold is the best-performing asset of 2025, continuing the strong momentum that has been in place since 2024.

Cryptocurrencies also benefit from this trend, as tokenized gold has long existed in our market, the most notable being Tether Gold (XAUT) and PAX Gold (PAXG). Although the circulations of XAUT and PAXG have only seen slight increases, their market capitalizations have grown by 59% and 78% respectively since the beginning of 2024, reaching a total market cap of $1.6 billion by the end of April.

Where is cryptocurrency headed? If you bought in when Bitcoin (BTC) was down, congratulations! Your returns could now be as high as 25%! BTC has performed far better than other risk assets like U.S. stocks, and many are now speculating whether this is the turning point for Bitcoin to ultimately prove its strength as a store of value asset.

For a long time, the cryptocurrency industry has championed the idea that “Bitcoin is digital gold,” claiming it has unique advantages—ease of transfer and storage. With increasing demand for gold and Trump’s tariffs, reports have indicated that the Bank of England has extended the withdrawal time for gold bars. If demand for physical gold continues to rise amid market uncertainty, this issue will only worsen.

It is currently very clear that the market will be influenced by Trump’s whims for quite a long time. Although we now have a 90-day pause, it is certain that there will be some ups and downs during this process, which means that market volatility will become more intense.

Even if Trump ultimately cancels most tariffs, the current uncertainty is likely to have already imposed costly impacts on U.S. businesses. Decisions to relocate production facilities or restructure supply chains take months to implement, and costs may take years to recover. With no clear progress in sight, management teams are left grappling with how to plan for the future, especially considering that some of these policies may be overturned during Trump’s remaining term or by the next U.S. president four years from now.

Entering May, the old saying “Sell in May and go away” becomes particularly important, as this month has historically been a poor performer for the cryptocurrency market. We have just released the first quarter 2025 GDP data for the United States, which shows a contraction of 0.3%. This is not a good sign for the U.S. economy, as the full impact of tariffs has yet to be seen. Rumors about “economic recession” and even concerning “stagflation” have been circulating.

However, given Trump’s many weaknesses, there may be opportunities for traders looking to “buy on dips.” An important milestone to watch is July, when the U.S. economy will feel the impact of tariffs on prices and employment, until the end of the 90-day “Liberation Day” tariff suspension period, as well as the second quarter GDP data to be released at the end of the month.

Will the U.S. reach a positive trade agreement with allies and trade partners by then? Will China yield as Trump hopes and ultimately reach a significant agreement? Or will the U.S. economic situation be so poor that Trump has to change course? All of these are possible, and if you are a gambler, then all these outcomes are available on Polymarkets.

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Currently, going long on gold seems to be the only surefire profit-making trade in the market. As for other areas, if you’re still investing in the stock market, buckle up, because we will endure more volatility brought by Trump.