Bitcoin Slides as Recession Fears and Trade War Tensions Mount
The possibility of a U.S. recession in 2025 is growing, with analysts pointing to economic uncertainty and escalating trade tensions as key risks.
Market expert Nic Puckrin estimates a 40% chance of recession, noting that while not inevitable, the current landscape is unfavorable for risk assets like cryptocurrencies. He highlights that policy decisions, including budget cuts and federal job reductions, could have unintended economic consequences.
Investor sentiment has been shaken, contributing to a decline in the U.S. Dollar Index (DXY) as capital flows toward European markets. The index dropped sharply in March 2025, reflecting broader macroeconomic concerns.
Tariffs imposed by President Trump have intensified market instability, triggering a significant sell-off in the crypto sector. Bitcoin has plunged 24% from its January peak of $109,000, while altcoins have suffered even steeper declines.
The heightened trade war fears have shifted market sentiment from post-election optimism to extreme caution. Analysts suggest the pressure on crypto markets could persist until at least April unless trade negotiations bring relief.
Some experts see signs that Bitcoin could be nearing a bottom. Markus Thielen of 10x Research believes a shift in Trump’s trade rhetoric may pave the way for a recovery. If the administration eases its stance on tariffs or negotiates compromises, a reversal in Bitcoin’s trajectory could follow.
Editorial Team
Reporter at Coindoo
