Bitcoin’s (BTC-USD) price inched up by around 1% to $87,500 (£67,743) in early trading on Thursday, even as global financial markets braced for the fallout from US president Donald Trump’s announcement of a 25% tariff on foreign-made automobiles and auto parts.
The tariff, set to take effect on 2 April, are aimed at bolstering domestic car manufacturing and have already stirred fears of further volatility in global equities. Investor sentiment has turned risk-off as the new measures prompted a notable sell-off in stocks. The S&P 500 (^GSPC) and the NASDAQ (^IXIC) Composite dropped lower on Wednesday, by around 1% and 2% respectively.
However, GameStop (GME) increased nearly 12% on Wednesday following its board’s unanimous approval to incorporate bitcoin as a treasury reserve asset.
QCP Capital analysts noted in a market note: “GameStop’s surprise $1.3bn (£1.01bn) capital raise for bitcoin allocation has yet to lift broader sentiment in the cryptocurrency market.”
They added that while spot bitcoin exchange-traded funds (ETFs) have attracted a steady inflow, spot ethereum (ETH-USD) ETFs have experienced outflows.
WeFi Head of Growth Agne Linge pointed out another factor that could weigh on the cryptocurrency market’s ability to regain upward momentum. “The impact of tariffs on semiconductors pose structural risks for the crypto industry,” Linge said. “With bitcoin mining reliant on high-performance chips, increased costs and potential supply chain disruptions could reduce mining profitability and even threaten network security if smaller operations shut down.”
