Bitcoin’s (BTC-USD) price edged up by approximately 1% to $87,500 (£67,743) in early Thursday trading, even as global markets reacted to US President Donald Trump’s announcement of a 25% tariff on foreign-made automobiles and auto parts.
Set to take effect on April 2, the new tariffs are intended to boost domestic car manufacturing but have already triggered fears of heightened market volatility.
Investor sentiment turned risk-averse, leading to a significant sell-off in equities. On Wednesday, the S&P 500 (^GSPC) dropped about 1%, while the NASDAQ (^IXIC) Composite fell by around 2%.
Despite the broader market downturn, GameStop (GME) surged nearly 12% on Wednesday after its board unanimously approved the integration of bitcoin as a treasury reserve asset.
QCP Capital analysts commented in a market note: “GameStop’s surprise $1.3bn (£1.01bn) capital raise for bitcoin allocation has yet to lift broader sentiment in the cryptocurrency market.”
They further noted a divergence in investment trends, with spot bitcoin exchange-traded funds (ETFs) continuing to attract inflows, while spot ethereum (ETH-USD) ETFs have seen outflows.
Meanwhile, concerns remain over potential risks to the crypto industry. WeFi’s Head of Growth, Agne Linge, highlighted a key challenge, stating: “The impact of tariffs on semiconductors pose structural risks for the crypto industry. With bitcoin mining reliant on high-performance chips, increased costs and potential supply chain disruptions could reduce mining profitability and even threaten network security if smaller operations shut down.”
Amid market turbulence, traditional safe-haven assets have drawn increased investor interest. Gold (GC=F) prices climbed to a weekly high of $3,035 on Thursday as investors sought refuge from economic uncertainty.
Messari research analyst Sam Ruskin noted the trend, stating on X.com: “Bitcoin and gold’s pump suggests investors are seeking safe havens amid widespread disappointment post-inauguration and concerns over a global trade war.”
With financial markets on edge, investors will be closely watching the impact of the new tariffs and potential ripple effects on cryptocurrencies and other assets.
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