From Morningstar: 2025-04-16 07:56:00

Bitcoin’s recent drop following Trump’s tariff announcement highlights its evolving role as a macro-sensitive asset, mirroring tech stocks’ behavior. During the same week, bitcoin, S&P 500, and Nasdaq 100 all experienced significant losses. Institutional investors now treat bitcoin similarly to tech stocks, resulting in synchronized trading patterns during macroeconomic events.

Trump’s tariff announcements sparked a global flight to safety, causing investors to exit equities and bitcoin, leading to parallel 15% declines. Conversely, news of a 90-day suspension of tariffs led to a risk-on sentiment resurgence, with bitcoin surging alongside equity rallies. Bitcoin’s association with equities during market turbulence is evident.

Bitcoin’s volatility has decreased significantly in recent years, with a 90-day annualized volatility dropping from 95% to 52%. This shift is attributed to growing institutional participation and the development of regulated financial instruments. Major financial institutions are allocating portions of their portfolios to digital assets, displacing retail-driven speculation and reducing historical volatility.

While Trump’s pro-crypto stance may create a friendlier policy environment, investors should expect volatility and opportunity in bitcoin markets. Favorable regulations in the US and the opening of the European market are expected to attract new institutional investors. Bitcoin may reach new records in the next 12 to 18 months, consolidating its role in diversified wallets, but price fluctuations are inevitable.



Read more at Morningstar: Is Bitcoin Trading Like Tech Stocks?