Is Bitcoin Finally Decoupling from Traditional Markets? | Bitcoin News by CoinCorner

Transcript

Trump's tariff war continues to wreak havoc across markets causing Bitcoin to have its worst quarter since the collapse of crypto exchange FTX. At the same time though, there are signs that Bitcoin could potentially be decoupling from stocks and other risk assets, offering some stability and value as a safe haven asset. Square point of sale systems, which currently process around $200 billion annually, are working on accepting Bitcoin payments.

Welcome back to Bitcoin News brought to you by Coin Corner. I'm your host Alex Glass. Now let's get straight into this week's top stories.

Well, what a week. Almost every market has tanked off the back of Trump's tariff rollout, with all global stock indexes sitting down around 9 to 12% over the past week. Typically amongst the chaos, Bitcoin is also down around 10% and 30% from all-time highs.

Now painful as it is to see, when taking a step back and looking at how all of these different markets have fared, analysts are now suggesting that there could be significant hope for Bitcoin compared to these other asset classes.

So last week, following an announcement from Fed Chair Jerome Powell, he cautioned that Trump's tariffs could lead to higher inflation, and this caused a significant sell-off throughout the stock market, wiping out $3.25 trillion worth of value.

But at the same time, the crypto market gained $5.4 billion. Bitcoin's price appears to be decoupling from stocks, which is uncharacteristic for the asset. And on that day last week, it held above 82,000 and even rallied to 84,000, whilst the stock market continued to sell off.

With that, analysts and speculators are now suggesting that maybe traditional investors could now be looking at Bitcoin as a potential safe haven store of value during these uncertain times.

It's hard to know if this tariff war is doing what Trump intended, but one thing is for sure: Trump is desperate for the Fed to cut interest rates. He said on Truth Social last week that this would be a perfect time to cut interest rates.

"Energy prices are down, inflation is down, even eggs are down 69%. Cut interest rates, Jerome, and stop playing political games."

Despite what Trump says though, the US economic data doesn't fully support this argument. Unemployment has remained low, non-farm payrolls added 228,000 jobs exceeding expectations, and CPI is still above the 2% target at 2.8%.

Typically, lowering interest rates is something that the Fed might look to do if the US economic data was looking too weak - with high unemployment, low growth, and CPI that's within their target range.

Coin Corner CEO Danny Scott said this week in regards to the tariffs that some speculate he's doing this to force markets down in the short term to pressure the Federal Reserve into reducing rates. This is in the hope that a rate reduction will allow the US to refinance its debt at lower rates, reducing interest payments and helping to shrink the national debt deficit over time.

If this happens - lower interest rates and potentially introducing quantitative easing to help stimulate the economy - this is likely to have a positive impact on Bitcoin, as we've seen in the past.

Danny also shared a bullish take on Bitcoin's price, mentioning that the Bitcoin halving usually takes around 12 months to really kick in, with the following 6 to 12 months often being incredibly bullish due to the supply and demand.

We're now approaching the 12-month mark since the last halving, so this combined with a potential tariff cooldown, the US strategic reserve, a potential recession, and countries around the world mining and buying Bitcoin amid the ongoing uncertainty of the US dollar as a global reserve, means that we're likely seeing history playing out in front of our eyes.

Now despite this bullish take, Q1 of 2025 has just been revealed as the worst quarter for Bitcoin since the collapse of FTX. The election of US President Donald Trump was supposed to usher a golden era for crypto, but Bitcoin has now recorded the worst Q1 in 7 years, and market sentiment fell to its lowest point since the last bear market.

That being said though, as mentioned before, there are potentially lots of bullish catalysts on the horizon - it just appears at this time tariffs are making the most noise.

Now speaking of FTX, it's been revealed that 400,000 users are at risk of losing $2.5 billion worth of repayments. According to a court filing, roughly 392,000 FTX creditors have failed to complete or at least even take the first steps of a mandatory Know Your Customer verification, which had an original deadline of the 3rd of March.

The deadline has now been extended to the 1st of June, but those who fail to meet this may have their claims permanently disqualified - missing out on the recovery plan that expects to return at least 118% of creditors' original claims.

Also in the news, we have more knock-on effects from Trump's tariffs as Bitcoin mining stocks plunge amid revenue concerns. Most mining stocks fell by 10% on Monday, adding to last week's sell-off. MARA was down almost 11%, RIOT 8%, and Clean Spark 10%.

One of the concerns is that Chinese manufacturers hold the lion's share of the market for Bitcoin mining machines. And if the tariffs hold, they will likely make mining more expensive for those already navigating higher energy costs and lower profit margins following the recent halving that cut their rewards by half.

At the same time, with Bitcoin's recent drop in price and mining competition reaching new all-time highs, mining revenue is getting squeezed.

Another aspect that Trump has possibly overlooked is that these tariffs could also push mining outside of the US, as importing machines may become too costly for businesses. Yuran Merilid, CEO of Hash Labs, said that as machine prices rise in the US, they could paradoxically decrease in the rest of the world.

Manufacturers will be left with excess stock originally intended for the US market, and to offload the surplus, they'll need to lower prices and attract buyers in other regions, he said. Even if these tariffs are rolled back within a few months, he believes that the damage is already done. Confidence in long-term planning has been shaken. Few will feel comfortable making major investments when critical variables change overnight.

Now for our final story, we do have some positivity amongst all of this tariff drama. It's been confirmed by Jack Dorsey, CEO of Block, that they are currently working on accepting Bitcoin payments on Square point of sale terminals.

Square POS systems currently serve approximately 4 million businesses worldwide, processing around $200 billion annually. In an interview, Jack said he believes that the biggest threat to Bitcoin is that it becomes irrelevant if it's only used as a store of value and not used for everyday payments.

He then confirmed later on X that it's not just a simple switch to turn on Bitcoin payments with Square, but they are doing it now.

I'm afraid that is all we have for you today. If you got value from this video, please drop a like down below and make sure you subscribe so you never miss an update of Bitcoin News.