The Great Liberation of Wealth Reveals BTC’s Strength
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| By Marija Matic |
"Liberation Day" came last week. That’s what President Donald Trump called April 2, 2025 — the day he announced the most sweeping tariff hike since the Smoot-Hawley Tariff Act of 1930.
The goal was to correct what the administration considers decades of asymmetrical foreign tariffs against U.S. exports and other barriers that boxed out U.S. goods.
But in the days since last Wednesday, the only liberation has ironically been money from the markets.
The S&P 500 plummeted 10% in just two days last week, marking the steepest decline since the COVID-19 crash.
This exceptional market turbulence, reminiscent of historical Black Monday crashes, has investors nervous. They’re debating whether the correction has found its bottom … or if further declines loom on the horizon.
While the crypto market was a bastion of resilience amid traditional market turmoil last week, Bitcoin (BTC, “A-”) capitulated today. It dropped to its support level at $74,500 before bouncing back to the $78,000 area.
Its fall pulled the broad market along for the ride.
Crypto Market Response
The crypto market finally succumbed to broader market pressures today. It shed over 10% of its total market cap before bouncing and regaining some losses.
But even before the bounce, Bitcoin has still fared better than stocks over the past month.
Prior to the recovery, monthly performance metrics have shown the S&P 500 actually underperforming Bitcoin, with declines of 12.06% and 10.09%, respectively.
Weekly metrics revealed a similar pattern: The S&P 500 and Nasdaq fell approximately 8.22% compared to Bitcoin's 6.9% decline.
To get a sense of where crypto will go from here, I looked at Bitcoin's derivatives market. And surprisingly, perpetual futures currently exhibit remarkably healthy conditions.
Funding rates are maintaining equilibrium near zero. This suggests an even distribution of leveraged positions between bullish and bearish traders, which is in stark contrast to last month.
Specifically, on March 24-26, funding rates turned negative and bottomed at 0.9% per month as market sentiment shifted decidedly toward bearish, with traders paying premiums to maintain short positions.
In short, the sentiment in Bitcoin is better now — with tariff-fueled sell-offs rocking both TradFi and cryptos — than it was two weeks ago.
While it is too early to tell, this could be the start of another decoupling period. That is, where Bitcoin establishes itself as an independent asset class, free from traditional market movements.
That would be welcome in the near term. But we’ll have to wait to see if that’ll be the case.
The Lesson: Focus on Bitcoin
Beyond mere price action, Bitcoin's fundamentals are reaching unprecedented heights, with network hashrate metrics shattering records.
Bitcoin's network processing power has reached a historic milestone of 1 Zetahash per second (ZH/s), a remarkable achievement in the cryptocurrency's 16-year history!
This current hashrate represents a 1,000-fold increase since late January 2016.
This tells us that, despite the recent price action, this technological fortress has never been more secure or robust.
To contextualize this computational power, Bitcoin now processes approximately 40,000 times more calculations per second than Litecoin (LTC, “C+”), the second largest proof-of-work cryptocurrency network.
Miners are aggressively expanding operations and deploying more efficient hardware. Additionally, at least 24 publicly listed companies now operate Bitcoin mining equipment, according to CompaniesMarketCap.com.
This remarkable technical achievement occurring amid sharp market decline presents a compelling case for long-term Bitcoin accumulation.
As traditional markets falter under political and economic pressures, Bitcoin's fundamentals continue to strengthen and grow as it offers a safe harbor as a leading independent payment network.
Should it decouple from the markets even further, BTC’s status as a safe haven will become clearer. And that will act like a lighthouse to all those fleeing the TradFi markets.
As such, most crypto investors are likely to keep their focus on BTC for now.
But if you’re the sort of investor who looks for opportunities in the correction, there is one sector that did manage to stave off the worst of the selling.
Exchange Tokens Resist the Altcoin Sell-Off
Altcoins have broadly suffered notably steeper declines as investors systematically reduce their risk exposure over the past few weeks by either rotating capital from altcoins into Bitcoin or implementing delta-neutral strategies to weather this market turbulence.
This ongoing flight to safety explains why most top 100 cryptocurrencies have plummeted over 60% from their all-time highs … while only a select few demonstrate meaningful resilience.
But there’s a particularly intriguing group in that select few: centralized exchange tokens.
They have displayed remarkable stability amid the chaos …
- GateToken (GATE, Not Yet Rated), Gate.io’s utility token, is down 19%.
- Bitfinex’s LEO Token (LEO, Not Yet Rated) is down 12%.
- And WhiteBIT’s WhiteBIT Coin (WBT, Not Yet Rated) is down a mere 10.8% from their respective peaks.
This interesting stability of centralized exchange tokens suggests we might be witnessing the emergence of a "CEX tokens" narrative in the coming weeks, provided the broader market stabilizes enough to allow for sector rotation.
If trading popular narratives is something you’re interested in for the coming rally, this may be a sector worth watching.
Otherwise, all eyes will be on BTC until the turmoil is behind us.
Best,
Marija Matić
