5 reasons the trade war could boost Bitcoin bullish

Escalating tensions in the trade war have caused significant fluctuations in the market, raising increasing concerns among investors. However, an analyst believes that these very instabilities could serve as a catalyst for Bitcoin price growth.

This outlook emerges amid Bitcoin struggling to regain momentum, while both the traditional financial market and the crypto market show signs of widespread losses.

Is the trade war a big opportunity for Bitcoin?

In a detailed analysis published on social media platform X, Ben Sigman — analyst and CEO of Bitcoin Libre — pointed out five distinct factors through which trade conflicts caused by tariffs could stimulate the increase in the value of Bitcoin.

The first factor is the potential trajectory of the U.S. dollar. According to him, the trade war will strengthen the dollar. However, the risk of subsequent collapse will reverse this situation.

"Tariffs are causing the dollar to soar. Emerging markets (EM) are crumbling under the pressure of $12 trillion in debt. Confidence in fiat currency is declining. Capital flows will seek safety in fixed supply areas," he said.

Sigman believes that in this case, capital flows may seek out assets with a fixed supply, such as Bitcoin, making it a safe haven amid financial instability.

Next, he pointed out the potential of Bitcoin as a hedge against inflation. Tariff levels often disrupt global supply chains, leading to increased costs of goods and stifling economic growth. To counter this situation, central banks — including the U.S. Federal Reserve (Fed) — may cut interest rates, thereby reducing the value of national currencies.

Sigman argues that the inherent scarcity and global accessibility of Bitcoin makes it an attractive hedge in such a context.

On Tuesday, Sigman emphasized the growing trend of de-dollarization. He explained that countries like China — which currently conducts 56% of its trade transactions in renminbi — are increasingly seeking alternatives to the US dollar.

According to him, the BRICS alliance ( consists of Brazil, Russia, India, China, and South Africa) will also develop alternative financial systems. However, this shift is not without risks, as it could lead to capital flight.

"Bitcoin thrives in a fragmented world as a neutral and global choice," he affirmed.

Fourth, Sigman predicts panic in the market. Britain estimates that just one cycle of tariffs could wipe out $5 trillion in market value, flatten the bond yield curve and make traditional haven assets like gold less attractive.

In such an environment, the volatility of Bitcoin can attract investors looking for "high risk, high reward" opportunities, which may in turn drive large capital inflows into the market.

Finally, Sigman argues that the trade war could expose systemic weaknesses in global financial institutions. Tariffs will lead to defaults and erode confidence in the fiat-based system, causing investors to turn to Bitcoin.

"Bitcoin was born to confront these things – no permission needed, no borders, no banks," he concluded.

However, not all analysts share the optimistic view of Sigman. Prominent commentator Fred Krueger recently made 9 predictions about the likelihood of the United States imposing tariffs exceeding 100% on China within the next year. He forecasts that this measure could cause Bitcoin and other cryptocurrencies like Solana (SOL) to decline significantly.

"Everything will crash together. Then there will come the time to end it. When? Unfortunately, Trump has lost his mind and is being poorly advised," Krueger wrote.

When asked if Bitcoin could fall to 0, he humorously replied that:

"I will buy it all if the price is still 1 dollar."

As trade tensions between the United States and China escalate — due to additional tariffs imposed on Chinese goods and broader geopolitical conflicts — the role of Bitcoin in the global financial arena is being closely monitored. The long-term performance of this largest cryptocurrency in the world remains unpredictable.

BTC 4-hour price chart | Source: TradingviewCurrently, the market seems to be quite pessimistic. Data shows that in the past 24 hours, the price of BTC has decreased by 4.6%. At the time of writing, the price is being traded at $76,342.

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

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Minh Anh

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