By Brett Munster
Tariffs trigger volatility
On April 2, global markets were rocked by a fresh wave of volatility when President Donald Trump announced sweeping new tariffs targeting nearly 90 countries, rekindling fears of a full-blown global trade war. In just 48 hours, the S&P 500 plunged more than 10.5%, marking its fifth-largest two-day drop in history and leaving the index down over 18% from the highs it had reached earlier this year.
To put this recent crash into context, the only steeper short-term drops occurred during some of the most turbulent periods in modern history: Black Monday in 1987, the 1929 crash that triggered the Great Depression, the March 2020 COVID panic, and the November 2008 meltdown following the Lehman Brothers collapse.
As markets grappled with the ripple effects of rising consumer prices, supply chain disruptions, and looming retaliatory trade measures, virtually every asset class felt the impact — including crypto. Bitcoin and its digital counterparts weren’t spared from the initial wave of selling, with prices falling in lockstep with equities as fear swept across global markets.
But here’s the thing: crypto markets have seen this movie before, and more often than not, it finds a way to flip the script.
One of crypto’s defining traits is its 24/7, highly liquid nature — making it one of the first asset classes to react when major macro news hits, especially outside traditional market hours. In these moments, crypto often acts as a global “risk thermometer,” reflecting investor sentiment in real time. That can lead to swift, emotionally driven selloffs when uncertainty surges — as was likely the case in early April.
But history suggests these dips are often short-lived. In fact, they tend to set the stage for even stronger recoveries.
BlackRock — yes, that BlackRock — recently underscored this point in a whitepaper titled “Bitcoin: A Unique Diversifier.” The world’s largest asset manager argues that bitcoin’s decentralized nature, resistance to political manipulation, and immunity to counterparty risk give it a fundamentally different risk profile than traditional assets. During past geopolitical shocks — from the 2020 pandemic to Russia’s invasion of Ukraine, to the banking crisis of 2023 — bitcoin initially sold off alongside stocks. But each time, it was among the first assets to rebound, often outpacing equities, gold, and bonds.
Remember March 2020? As the world went into lockdown and markets froze, bitcoin dropped over 50% in a matter of days. But by May, it had recovered. By December, it had quadrupled. Similar patterns played out in 2022 and 2023 — panic selling, followed by powerful rallies, as investors reassessed bitcoin’s role in an increasingly uncertain world.
There’s good reason to believe the current, tariff-driven downturn is yet another chapter in a familiar playbook. Unlike global exporters, bitcoin remains largely immune to tariffs. In fact, crypto may be the only truly tariff-proof financial system in existence. Peer-to-peer digital asset transfers can’t be taxed at the border. There are no customs lines for moving bitcoin across continents, no centralized intermediaries in DeFi protocols to sanction or block. That kind of resilience isn’t just a technical quirk — it’s a structural advantage in an increasingly protectionist world.
As global trade relationships grow more complex — and as more countries seek alternatives to the U.S. dollar — neutral, decentralized assets like bitcoin are gaining strategic appeal. In a world trending toward economic fragmentation, where national currencies are increasingly used as geopolitical weapons, the case for an independent global settlement layer becomes not just compelling, but urgent. For countries hedging against dollar exposure, or individuals seeking protection from erratic domestic policies, bitcoin is no longer just a speculative asset — it’s beginning to look like essential infrastructure. We may be witnessing the early stages of bitcoin’s ascendancy as a global settlement layer and collateral asset.
But the bullish case doesn’t stop at geopolitics. The macroeconomic setup is quietly turning into a powder keg for crypto upside.
Tariffs don’t just disrupt global trade — they also undercut government revenue on multiple fronts. Declining equity markets mean lower capital gains tax receipts, a major driver of federal income. Add a potential recession to the mix, and you get shrinking corporate profits, weaker payrolls, and a broad erosion of the tax base. Unless Washington steps in with fresh stimulus, fiscal year 2025 is shaping up to be a revenue shortfall — and a widening budget deficit. That kind of environment has historically been rocket fuel for hard assets, especially decentralized ones like bitcoin that sit outside the reach of monetary or fiscal policy.
And here’s where things really start to heat up.
In a typical risk-off environment, a stock market selloff sends investors rushing into U.S. Treasuries, driving bond prices up and yields down. But that’s not what happened last week.
Instead, Treasuries sold off alongside equities. The 10-year yield surged from 3.8% to 4.5% in just two days, while the 30-year yield recorded its largest spike in over forty years. This rare, synchronized selloff carries serious implications: the U.S. government is now staring down the barrel of refinancing trillions in debt at much steeper rates — a shift that could trigger soaring interest payments and significantly widen the federal deficit.
With revenues declining and expenses surging — particularly interest payments on the ballooning national debt — the U.S. deficit is on track to widen dramatically. Even before the April 2 tariff announcement, the federal budget deficit was projected to hit $2.5 trillion this year, up 50% from the previous year. Now, with the added drag on growth and tax revenue, a $3 trillion deficit is looking increasingly plausible.
Larger fiscal imbalances mean one of two things: either the Fed steps in with aggressive stimulus — as it did in 2020, injecting trillions into the economy — or it’s eventually forced to monetize the debt through large-scale money printing. In either scenario, the result is the same: significant currency debasement.
When that moment arrives, capital is likely to rotate into hard assets — especially those immune to inflation and political risk. Gold will play its usual role, but bitcoin, with its digital scarcity and 24/7 liquidity, is well-positioned to be the fastest horse out of the gate. As liquidity returns and uncertainty lingers, bitcoin is likely to once again emerge as a top-performing asset coming out of this drawdown.
Of course, we’re not out of the woods yet. The coming weeks will likely bring more turbulence as investors parse central bank decisions, retaliatory trade threats, and fresh economic data. Crypto’s volatility cuts both ways — expect some sharp swings. But the long-term fundamentals haven’t just held firm — they’ve improved.
Regulatory clarity is improving in the U.S. at a breakneck speed. Global liquidity, which was already rising, is now set to see further increase this year. Institutional, corporate, and nation -state adoption continues to deepen. And most importantly, the fundamental value proposition of crypto remains compelling: it’s a borderless, permissionless, censorship-resistant system for transacting and storing value in an increasingly uncertain world.
Bitcoin’s fixed supply makes it immune to the inflationary pressures plaguing fiat currencies. Its decentralized nature makes it resistant to political manipulation. And its accessibility — anyone with a smartphone and an internet connection can use it — makes it the most inclusive financial system on Earth.
While the near-term outlook may be volatile, the long-term fundamentals remain robust. Historically, macroeconomic turbulence has done more than test crypto’s resilience — it has underscored its utility and hastened its adoption. If historical patterns are any guide, this tariff-driven pullback may ultimately be remembered not as a turning point downward, but as a temporary dislocation — the kind of moment that, in retrospect, rewarded those investors who held their conviction.
Crypto is the rare issue bringing democrats and republicans together
For years, I have argued that adopting bitcoin and supporting the broader crypto industry not only benefits America but also embody principles valued by both liberals and conservatives, making crypto a truly bipartisan issue. Now, in 2025, there is more evidence than ever that crypto might be one of the few topics uniting both sides of the political spectrum. While conservatives and liberals approach the industry from different perspectives, their shared interest in digital assets is fostering cooperation in ways few other issues do.
For conservatives, crypto aligns with key values such as free markets, financial independence, and limited government. Many on the right see bitcoin’s global accessibility and immutable monetary policy as a prime example of a truly free market—one that operates without central control, is driven purely by supply and demand, and allows anyone in the world to participate. Its decentralized nature also serves as a safeguard against government overreach and excessive regulation, reinforcing the belief that individuals—not institutions—should control their own wealth. Crypto’s emphasis on personal responsibility and self-sovereignty resonates strongly with those who champion economic freedom and self-sufficiency.
For liberals, crypto presents advantages that align with progressive priorities such as financial inclusion, reducing corporate influence, and supporting social progress. Digital assets provide access to financial services for unbanked and underbanked communities, helping to bridge economic gaps. Many on the left view crypto as a tool to challenge the dominance of large financial institutions, reducing corporate monopolization and empowering individuals. Additionally, crypto has played a vital role in humanitarian aid, enabling funds to reach those in need more efficiently and providing economic empowerment for individuals living under authoritarian regimes.
Beyond ideology, the crypto industry is proving to be a significant asset to the U.S. economy, creating thousands of high-paying jobs and driving innovation in finance, technology, and cybersecurity—particularly in states like Texas, Wyoming, and Florida that have embraced the sector. Stablecoins, which are digital assets pegged to the U.S. dollar, are strengthening the dollar’s role in global finance by increasing demand for U.S. treasuries at a time when many countries are reducing their purchases of U.S. debt. Over time, the creation of a strategic bitcoin reserve could even help address America’s growing debt burden. Additionally, maintaining leadership in the crypto space is crucial for national security, ensuring that the U.S. remains at the forefront of digital finance while countering the influence of authoritarian-controlled digital currencies like China’s digital yuan.
This broad economic and strategic importance is partly why the previous administration’s anti-crypto stance was so frustrating—crypto benefits America and advances key Democratic priorities. With that administration no longer pressuring Democratic lawmakers to oppose crypto, we are now witnessing a shift in Washington, where leaders from both parties are working together to support regulatory clarity and responsible innovation. In fact, some of the most bipartisan votes in recent memory have been on crypto-related legislation.
In 2024, Congress moved to repeal the SEC’s controversial Staff Accounting Bulletin No. 121 (SAB 121), which had restricted banks from engaging with digital assets. The House passed the repeal with a vote of 228-182, with 21 Democrats crossing the aisle to support it. A week later, the Senate approved the measure with a 60-38 vote, with key Democratic leaders, including Senate Majority Leader Chuck Schumer, siding with Republicans.
Earlier this year, both chambers overwhelmingly voted to overturn an IRS broker-dealer rule that would have imposed restrictive tax reporting requirements on decentralized finance (DeFi) platforms. The Senate passed the repeal with a 70-27 vote—making it more bipartisan than any Senate vote in recent history including the government funding bill that prevented a shutdown in March. The House followed with a 292-132 vote, with 76 Democrats joining Republicans in support.
Most recently, on March 13, 2025, the Senate Banking Committee passed the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act with an 18-6 vote. Co-sponsored by Republican Senator Bill Hagerty and Democratic Senator Kirsten Gillibrand, the bill received strong bipartisan backing as lawmakers recognized the need for a clear regulatory framework for stablecoins. With momentum behind it, the bill is now poised for a full Senate vote.
In today’s deeply divided political climate, it is rare to find an issue that unites lawmakers from both sides of the aisle. Yet, crypto has emerged as one of the few—if not the only—topics that consistently garners bipartisan support. Whether driven by conservative principles of economic freedom or liberal goals of financial inclusion, the crypto industry is proving to be a unifying force in Washington, signaling a promising future for both this industry and America.
In Other News
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Stablecoin giant Circle files for IPO.
SEC chair nominee Atkins gets confirmation from Senate Banking Committee.
Bitcoin begins to decouple from Nasdaq as U.S. stocks crumble.
Justice Department will disband its crypto-related enforcement team.
Disclaimer: This is not investment advice. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained constitutes a solicitation, recommendation, endorsement, or offer to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction. All Content is information of a general nature and does not address the circumstances of any particular individual or entity. Opinions expressed are solely my own and do not express the views or opinions of Blockforce Capital.
Disclaimer: This is not investment advice. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained constitutes a solicitation, recommendation, endorsement, or offer to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction. All Content is information of a general nature and does not address the circumstances of any particular individual or entity. Opinions expressed are solely my own and do not express the views or opinions of Blockforce Capital or Onramp Invest.
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