NYDIG: The crypto market is relatively stable despite Trump's tariff chaos.

According to an analyst from New York Digital Investment Group (NYDIG), the crypto market remains fairly stable while the traditional financial market is in turmoil due to U.S. President Donald Trump's "on-again, off-again" global tariff policy.

"Despite the devastation in traditional financial markets, the crypto market remains relatively orderly. History shows that during widespread sell-offs, we often see tensions emerge in the crypto market. But so far, that has not happened," Greg Cipolaro, global research director at NYDIG, wrote in a note on April 11.

Cipolaro stated that the futures rates (funding fees) for perpetual crypto futures "continue to remain positive," with liquidation spikes on April 6 and 7 – a few days after Trump first announced tariffs on April 2 – but in total only reached 480 million dollars, which he said "is much lower than other notable liquidation events."

He also noted that the price of USDT – a stablecoin pegged to the US dollar – has fallen below the $1 mark but "no significant drop has been recorded."

Trump announced a comprehensive series of tariffs on April 2, imposing tariffs on all countries, before suspending these measures for 90 days just hours after they took effect on April 9. He then shifted to a basic tariff rate of 10%, except for China, which is currently facing rates as high as 145%.

Both the traditional and crypto markets have plunged following Trump’s tariff announcement on April 2nd, and many assets have yet to recover to levels seen before that announcement.

The volatility index of stocks, bonds, and exchange rates has all increased following Trump's announcement of tariffs | Source: NYDIGOver the past weekend, the Trump administration continued to cause confusion with its tariff policy by declaring on April 13 that the decision to exempt many electronic items announced on April 11 was only temporary and these items will still be subject to tariffs thereafter.

Bitcoin performs well, reduced volatility makes it more attractive

Cipolaro stated that Bitcoin is not entirely immune to market volatility, "but at the current price level, it is still performing much better than many other asset classes."

He added that the volatility of Bitcoin has not surged to record levels as seen in traditional markets and "remains relatively stable" despite the instability caused by the Trump administration.

"Perhaps investors are increasingly seeking assets that retain value not linked to sovereign nations and, therefore, are not affected by trade disruptions."

According to data from CoinGecko, the price of Bitcoin has currently decreased by 22.5% from the mid-January peak of over $108,000 and has remained almost flat at $84,521 in the past 24 hours.

! bitcoin cryptoBTC price chart 4 hours | Source: TradingviewCipolaro said the narrowing gap between the volatility of Bitcoin and other assets is making the crypto king "more and more attractive" for funds that use risk-based asset allocation — funds that allocate assets based on risk rather than absolute value.

He added that investors may be reducing their exposure to risk, but "perhaps part of the portfolio reallocation towards Bitcoin is the reason this coin has become more resilient."

"The fact that funds use a risk-based asset allocation strategy to invest in Bitcoin can help reduce volatility, making the asset more attractive and potentially creating a positive loop between increased usage and stability," Cipolaro noted.

However, Ruslan Lienkha – the market director of YouHodler, stated in a note on April 12 that although the broader market is recovering, "the technical indicators paint a troubling picture."

He stated that the death cross model (moving average (MA) 50 days crossing below the MA 200 days) may be forming on both Bitcoin and the S&P 500 index.

Lienkha stated that this model "is often seen as a negative signal in the medium term, indicating that the market may struggle to maintain its upward momentum without a clear catalyst or a series of positive macroeconomic developments."

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should do thorough research before making any decisions. We are not responsible for your investment decisions.

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Minh Anh

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