A Year After Trump’s “Liberation Day” Tariffs, Crypto’s Hedge Narrative Still Hasn’t Recovered

More than a year after President Donald Trump unveiled sweeping “Liberation Day” tariffs, the episode still stands as a stress test that crypto largely failed. Bitcoin plunged below $82,000 as global markets convulsed, undercutting the long-running argument that digital assets act as a hedge against macroeconomic shocks, according to Crypto Briefing.

On April 2, 2025, Trump announced a 10% baseline tariff on nearly all imports alongside steeper reciprocal duties targeting dozens of countries. The move triggered a rapid selloff that wiped out trillions of dollars in shareholder value within days, with major stock indices falling more than 10% in the immediate aftermath, Crypto Briefing reports.

Bitcoin fell in step with stocks, not away from them

Rather than decoupling from equities as many investors expected, Bitcoin tracked the broader risk-off move almost in lockstep. Its slide below $82,000 illustrated how closely crypto had become tied to traditional markets during periods of acute stress, according to the outlet.

Capital fleeing the turmoil did not rotate into Bitcoin as a safe haven. Instead, investors moved toward cash and Treasuries, favoring assets seen as stable rather than volatile digital tokens, Crypto Briefing notes.

China bore the brunt of the tariff escalation, with duties eventually climbing as high as 125%, far above the 10% baseline applied elsewhere.

A 90-day pause sparked a sharp rebound

The panic eased somewhat on April 9, when Trump announced a 90-day pause on most of the elevated tariffs, though China’s 125% rate remained in place. The S&P 500 responded with a 9.52% single-session surge, its largest daily gain since 2008, according to Crypto Briefing.

Crypto markets bounced as well, but the recovery reinforced rather than refuted the correlation thesis. Bitcoin traded essentially as a leveraged bet on macro sentiment, with every tariff-related headline — whether signaling escalation with China or hints of a negotiated resolution — moving prices in tandem with equities.

Manufacturing jobs and consumer prices took a hit

Beyond the market swings, the tariff regime carried real economic costs. Roughly 90,000 manufacturing jobs were reportedly lost in the year following Liberation Day, while consumer prices trended persistently higher as the cost of imported goods worked its way through supply chains, Crypto Briefing reports.

Subsequent adjustments to the tariff policy and related court decisions kept injecting volatility into both traditional and crypto markets for months afterward.

What it means for portfolio strategy

The episode carries lasting implications for how investors think about diversification. If Bitcoin moves in the same direction as equities during periods of stress, it fails to deliver the uncorrelated protection that many allocators had assumed it would provide, according to the report.

The “digital gold” narrative that crypto advocates have promoted for years was, at least temporarily, undermined by a shock that hit stocks and tokens alike — a reminder that global markets remain deeply interconnected even when one asset class claims to stand apart.

Read more: Bitcoin exchange deposits hit rare 2026 extreme as 49,000 BTC hits exchanges