-
Treasury Secretary Scott Bessent’s comments about easing tariffs with China triggered a market rally, boosting both Bitcoin and traditional markets.
-
Unlike previous rallies, the traditional stock market deflated without an official White House denial, while Bitcoin’s price remained steady.
-
This divergence could suggest Bitcoin’s potential as a “safe haven” asset, staying resilient amid economic volatility and traditional market fluctuations.
Bitcoin shows promise as a safe haven asset amid market volatility, as Treasury Secretary’s tariff comments boost confidence in crypto despite traditional market fluctuations.
Bessent’s Tariff Comments Spur Market Pump
Trump’s tariffs have caused significant economic disruption, and the uncertainty is arguably impacting markets the most. Two weeks prior, false rumors of a tariff pause led to market surges, which were subsequently followed by an official pause announcement.
Today, a Bloomberg report claims that Scott Bessent believes the U.S. will de-escalate proposed tariffs on China, opening the door for new optimism.
“The next steps with China are, no one thinks the current status quo is sustainable at 145 and 125 [percent]. So I would posit that over the very near future, there will be a de-escalation. And I think that that should give the world, the markets, a sigh of relief… We have an embargo now, on both sides, right?” one source claimed Bessent said.
Immediately after this rumor began circulating, Bitcoin’s price surged in tandem with traditional stocks. The Dow Jones rebounded by 1,000 points, the S&P 500 increased by 500, and Nasdaq was up 3%.
Together, these factors created a new level of market enthusiasm.
Bitcoin Daily Price Chart. Source: COINOTAG
Bessent, a longstanding advocate for cryptocurrencies, has shown more hesitance than other cabinet members like Peter Navarro or Howard Lutnick regarding tariff stances.
Additionally, despite any personal convictions he may have, he has no actual authority to alter Trump’s decisions. Following this temporary relief, traditional stocks began to decline once again.
Nasdaq Deflates from Tariff Hopes. Source: Google Finance
There are two significant takeaways from this scenario. First, two weeks ago, the stock market tumbled after the White House officially denied pause rumors. Today, however, there has been no official response to Bessent’s comments.
Nonetheless, traditional markets still saw a decline, whereas Bitcoin remained robust above $91,000, and the total crypto market cap reached $2.96 trillion.
Does this data support the theory that Bitcoin may serve as a safe asset during a recession? It is challenging to make a definitive conclusion at this point. If Bitcoin rises alongside positive macroeconomic indicators while maintaining stability in bearish conditions, it seems almost too advantageous.
Still, Bitcoin is influenced by factors distinct from those affecting traditional finance. Investors should remain vigilant and monitor future tariff-related developments closely.
Conclusion
The recent market dynamics highlight a potential shift in how Bitcoin is perceived in relation to traditional assets. As traditional markets face pressures from fluctuating economic policies, Bitcoin’s ability to remain stable amid such uncertainty may enhance its credibility as a hedge during turbulent times. Investors moving forward should keep a close eye on economic indications and emerging tariff narratives.
