Bitcoin Faces Market Challenges Amidst Trade War Concerns, While Ethereum’s ETF Struggles Signal Institutional Shift

According to a recent analysis by Ryan Lee, Chief Analyst at Bitget Research Institute, the cryptocurrency market is navigating a complex scenario as it transitions into the second quarter. Bitcoin (BTC) is currently experiencing volatility within the $80,000 to $86,000 range, while Ethereum (ETH) is fluctuating between $1,600 and $2,200. This market behavior occurs in the backdrop of heightened concerns surrounding a proposed 25% tariff on goods from Mexico and Canada, set to take effect on April 2nd, potentially reigniting a trade conflict. Notably, BTC’s correlation with the Nasdaq now stands at 0.67, highlighting an increasing interdependence between cryptocurrency and traditional financial markets.

Institutional investment patterns are also becoming apparent, with Bitcoin exchange-traded funds (ETFs) attracting significant capital, suggesting heightened institutional interest in BTC compared to Ethereum. In contrast, ETH ETFs are witnessing capital outflows, indicating a shift in institutional preferences. Additionally, current statistics indicate that a 20% drop in ETH’s price could trigger liquidations exceeding $336 million, predominantly impacting decentralized finance (DeFi) lending platforms. The reliance of ETH on leveraged positions raises concerns about potential cascading liquidations, making the $1,600 support level critical for market stability.