The shifting association between Bitcoin and conventional financial markets is facing fresh strain as international investors abandon risk assets in light of escalating US trade conflicts.<\/p>\n
Bitcoin (BTC<\/a>) exchange-traded funds (ETFs) listed in the US experienced their fourth successive day of capital outflows on April 8, with over $326 million in net redemptions recorded across various products, based<\/a> on findings from Farside Investors.<\/p>\n BlackRock\u2019s iShares Bitcoin Trust ETF (IBIT) encountered the most significant sell-off, exceeding $252 million, marking its largest daily outflow since February 26.<\/p>\n Bitcoin ETF flows, US dollars, millions. Source: <\/em>Farside Investors<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n The selling pressure follows US President Donald Trump\u2019s April 2 declaration of extensive reciprocal import tariffs<\/a>, which ignited a remarkable $5 trillion loss<\/a> in the S&P 500 across two days.<\/p>\n Related: <\/strong><\/em>Bitcoin could compete with gold as an inflation hedge in the next decade \u2014 Adam Back<\/strong><\/em><\/a><\/p>\n The postponement of turbulence in the crypto market following the tariff-induced sell-off in traditional markets underscores Bitcoin\u2019s \u201cdeveloping relationship with traditional markets,\u201d as noted by Lennix Lai, global chief commercial officer at OKX exchange.<\/p>\n Lai conveyed to Cointelegraph:<\/p>\n \u201cWhile having fallen 26% since January\u2019s inauguration, Bitcoin\u2019s relative stability during the initial days post-tariff announcement \u2014 decreasing by 6% as opposed to Nasdaq\u2019s 11% drop \u2014 indicates a complex dynamic forming between crypto and traditional assets.\u201d<\/p><\/blockquote>\n Initially, Bitcoin maintained its position above the $82,000 support level, but on Sunday, April 6, it swiftly dropped below $75,000.<\/p>\n BTC\/USD, 1-year chart. Source: Cointelegraph Markets <\/em>Pro<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Some sector leaders attributed the sell-off on Sunday to Bitcoin\u2019s 24\/7 liquidity mechanics<\/a>, which positioned BTC as the only major liquid asset available for de-risking during the weekend.<\/p>\n Related: <\/strong><\/em>Bitcoin price could reach $250K by 2025 if Fed transitions to QE: Arthur Hayes<\/strong><\/em><\/a><\/p>\n Even though there are \u201cpromising signs\u201d of a diminishing correlation between Bitcoin and equities, Bitcoin\u2019s price pathway still correlates with global liquidity conditions, Lai stated, adding:<\/p>\n \u201cWhile I observe early signals of divergence, I contend that Bitcoin remains intrinsically linked to global liquidity conditions, necessitating caution amid potential market upheavals \u2014 even as gold acts as a safeguard against geopolitical instability.\u201d<\/p><\/blockquote>\n \u201cThe most vital factor here is not merely price movement but Bitcoin\u2019s increasing conceptual influence \u2014 individuals are progressively perceiving it as a legitimate strategic reserve asset for diversification amid chaotic traditional markets,\u201d Lai continued.<\/p>\n Other analysts also recognize the rising money supply as the primary catalyst for Bitcoin<\/a>.<\/p>\n \u201cBitcoin operates solely based on market expectations regarding future fiat supply,\u201d noted<\/a> Arthur Hayes<\/a>, co-founder of BitMEX and chief investment officer of Maelstrom.<\/p>\nBitcoin remains connected to global liquidity conditions<\/h2>\n