Bitcoin and major cryptocurrencies traded higher on Tuesday as strong institutional interest continued. However, the market remained cautious ahead of US President Donald Trump’s imposition of-for-tat tariffs, which could trigger volatility.
Investors are watching closely on April 2, which Trump has called “Liberation Day.” It is expected to reveal broad-based-for-tat tariffs that could affect global trade. Over the weekend, Trump indicated that these tariffs would apply to all countries, not just those with significant trade imbalances, raising concerns about the escalation of the trade war and its potential impact on economic growth.
The price of bullion rose to a record high for the fourth consecutive session, at $3,148.88 an ounce. Kyle Rodda, senior financial markets analyst at Capital.com, stated: “Along with the general risk aversion, investors are increasing their investments in gold, as the Trump administration’s trade policy threatens the dollar’s status as a special reserve.” “Fundamentals remain strong for gold.”
Demand for safe-haven U.S. Treasuries sent yields lower on Tuesday, with benchmark 10-year yields down 5 basis points to 4.1920%. That put pressure on the dollar, which fell 0.08% to 149.85 yen. The euro settled at $1.0813.
The Australian dollar rose 0.14% to $0.6258. The Reserve Bank of Australia kept interest rates at 4.1%, after cutting them by a quarter point in February for the first time in more than four years.
“The geopolitical uncertainty is also evident,” the RBA said in its statement, adding that U.S. tariffs are affecting confidence globally.
Matt Simpson, senior market analyst at City Index, said: “The RBA’s statement suggests they are slowly approaching the next cut, but are in no hurry to announce it. “The RBA just wants more time to make sure policy is on the right track.”
Lower Bitcoin Sale Could Pave the Way for Next Price Rise
Crypto Quant analyst, Axel Adler, Jr., noted that the daily selling volume on major trading platforms has decreased from 81,000 BTC (3.22% BTC) to 29,000 BTC. After this decline, the asset may enter a phase of undersupply as the number of seller’s decreases and demand continues, paving the way for the next Bitcoin price movement.
The shift in the futures trading market reflects this trend. In a separate post, Adler noted that short positions are rising as pessimistic traders seek to profit after Bitcoin hit a historic high in February. However, this pressure is now waning, and trading behavior is changing.
Through exchange-traded funds, institutional investors now play a larger role in the Bitcoin price trajectory than in the retail market. As a result, the asset has become more sensitive to macroeconomic events, such as Fed policy shifts and inflation reports.
At the same time, Binance’s dominance of spot trading may also indicate an uptrend. Joao Widson pointed out that Binance’s trading volume is now eight times higher than Coinbase’s, and that previous patterns have shown that Bitcoin often sees a rise in price when Binance leads the trading volume.
However, not all indicators point to immediate gains. Rising inflation and newly imposed tariffs could affect risky assets such as Bitcoin, according to a March 31 analysis by 10xResearch. Analysts of 10xResearch, which currently has an inflation rate of 5%, believe inflation expectations could slow institutional flows.
They expect the price of Bitcoin to fall below $80,000 this week, especially with the potential that several risk-reducing factors could put pressure on stocks and spill over into the cryptocurrency market.
At the time of publication, Bitcoin is trading at $83,530, with a seven-day trading range of between $81,488 and $88,240.
Viennick warns of Bitcoin’s impact on dollar dominance
BlackRock CEO Larry Fink, expressed concerns about the potential impact of bitcoin on the US dollar’s status as a global reserve currency.
In his annual letter, Fink highlighted the growing U.S. debt, which could undermine the dollar’s dominance. With U.S. interest payments expected to reach $952 billion this year, and mandatory government spending accounting for all federal revenue by 2030, Fink warned that continued financial mismanagement could push investors to turn to digital assets, especially Bitcoin.
The U.S. national debt has risen over the years, surpassing $34 trillion by early 2024, and surpassing $35 trillion by 2025. The rise in debt is attributed to factors such as stimulus measures during the COVID-19 pandemic, which contributed to inflation rising sharply in 2022.
With inflation soaring above 9%, the Federal Reserve raised interest rates at an unprecedented pace. Not only has it increased debt interest payments, it has also raised concerns about the potential financial “death spiral.” According to Fink, if the deficit continues to grow unchecked, the US risks losing its economic advantage to decentralized finance options like Bitcoin.
The belief that Bitcoin could eventually destabilize the US dollar has long been a recurring theme, and even previous insights have ruled out the threat of digital assets.
In a January interview on CNBC’s Squawk Box program, Goldman Sachs CEO David Solomon dismissed the idea that Bitcoin poses a threat to the dominance of the US dollar. He affirmed his belief in the central role of the US dollar in the global economy.
Furthermore, a separate report from CitiWild explored the debate beyond the scope of Bitcoin, noting that stablecoins, especially those pegged to the US dollar, could strengthen rather than undermine the dominance of the global dollar.
