Bitcoin Price Slumps After Trump Inauguration Surge, Markets Cautious Heading into April 2025

Bitcoin is entering April 2025 on uncertain footing after a dramatic rise and fall earlier this year. Bitcoin Price soared to an all-time high during the euphoria of President Donald Trump’s inauguration in January, then tumbled in the weeks that followed. Now, as the first quarter closes, market sentiment remains mixed with investors weighing whether a spring rebound or further volatility lies ahead.

Post-Inauguration Price Surge and Decline

Bitcoin jumped to a record level above $109,000 on Jan. 20, the day Trump was sworn in, buoyed by traders optimistic about the new administration’s pro-crypto promises. That rally proved short-lived. Within weeks, Bitcoin had fallen roughly 20% from its peak, dropping under the $90,000 mark. By late February it was trading around $88,000 – levels last seen before Trump’s election – as initial crypto euphoria gave way to a broad sell-off.

An exchange employee monitors a screen displaying cryptocurrency prices in Seoul, South Korea, in late 2024, when Bitcoin’s value was nearing $100,000. The token’s price later peaked above $109,000 on Inauguration Day 2025 before reversing sharply.

Multiple factors drove the reversal. On his first day in office, President Trump surprised markets by announcing new import tariffs, rattling investors and dampening risk appetite across the board. Hopes that Trump would immediately implement ultra-friendly crypto policies – such as creating a U.S. “bitcoin reserve” – also began to fade. “The market is disappointed with that,” said James Butterfill, head of research at asset manager CoinShares, noting that Trump ordered a crypto working group instead of direct government Bitcoin purchases. Meanwhile, hawkish signals from the U.S. Federal Reserve added further headwinds, as rising interest rates made speculative assets less attractive.

By the end of February, Bitcoin had erased nearly all its post-election gains, and nearly $1 trillion in nominal value had been wiped from the overall crypto market since its December highs. Other cryptocurrencies fared even worse – for instance, Ether (ETH) fell over 40% from its peak – underscoring the breadth of the downturn. “The initial excitement surrounding the Trump administration’s perceived pro-crypto stance appears to be in a phase of recalibration,” observed Gabe Selby, Head of Research at CF Benchmarks. Analysts say investors had to reset overly lofty expectations as Trump’s early crypto moves, while symbolic, delivered no immediate boom to prices.

Market Sentiment in Late March

As of late March, Bitcoin has steadied in the mid-$80,000s after finding support earlier in the month. The cryptocurrency briefly rebounded above $86,000 in mid-March amid encouraging macroeconomic signals – including the Fed’s decision to pause interest rate hikes – and fresh pledges from Trump to make the U.S. a “Bitcoin superpower”. That bump helped Bitcoin break a four-month downtrend, technically speaking, and reclaim key long-term moving averages that traders view as bullish indicators. “Bitcoin has most recently daily closed above the 200 EMA… retesting it into new support,” noted analyst Rekt Capital on March 20, pointing to improving momentum.

Even so, investor sentiment remains cautious. Ongoing global trade tensions – sparked by Trump’s tariff threats – and lack of clarity on U.S. crypto policy are keeping many traders on edge. “Global tariff concerns are the biggest driver at this moment,” explained Nicolai Søndergaard, a research analyst at Nansen, who expects risk assets may “lack direction until the tariff-related concerns are resolved” around early April. High interest rates are another damper. “We’re waiting for the Fed to see proper ‘bad news’ before they will really start cutting rates,” Søndergaard added, suggesting the Federal Reserve’s stance will continue to pressure risk appetite until rate cuts are on the horizon.

Market data reflects this wariness. After reaching “Extreme Greed” levels late last year, the popular Crypto Fear & Greed Index has now swung to “Extreme Fear” territory – recently measuring around 15 on its scale. That indicates many investors have become defensive, with some locking in profits or losses amid the volatility. “Recent buyers are locking in significant losses, reinforcing the exceptionally challenging conditions for newer investors,” noted analysts at exchange Bitfinex, as Bitcoin’s price hovering ~25% below its peak has put latecomers under water. Still, on-chain metrics show long-term holders remain confident: roughly 63% of Bitcoin supply has not moved in over a year, a sign that “HODLers” are sitting tight through the turbulence.

Expert Predictions for April 2025

Looking ahead to April, crypto market experts are divided on whether Bitcoin will resume its rally or continue consolidating. Optimists argue that the worst of the correction may be over, barring any new macro shocks. A number of analysts highlight the ~$70,000 to $75,000 zone as a strong support range that has held through the recent dip. “Bitcoin is more likely to establish firm support in the $72,000 to $80,000 range,” said Iliya Kalchev, an analyst at digital asset platform Nexo, adding that such a base “could provide a foundation for a more sustainable recovery” and makes a deeper fall below $75K less likely. Several market watchers, including Global Macro Investor CEO Raoul Pal, had predicted this exact pullback scenario: a peak above $110K in January followed by a drop toward $70K, before the next leg of the bull market. Now that it’s materialized, they expect a gradual rebound.

From a technical perspective, there are signs Bitcoin’s consolidation may soon give way to an upside breakout. Historical cycle analysis by TradingShot on TradingView notes that Bitcoin’s major corrections tend to last until the next key Fibonacci time pivot. “Corrections typically last until the 1.0 Fib time level, indicating a potential breakout by late April 2025,” the analysis finds. If the pattern holds, Bitcoin could be poised for a strong rally in Q2. Similarly, pseudonymous chartist “Egrag” pointed out that BTC’s recent low near $78K aligned with its 200-day moving average support – echoing fractals from past cycle resets – and predicts “a bumpy ride through March and April 2025, with price fluctuations around the 200 EMA before resuming its uptrend” toward new highs. Several strategists maintain six-figure price targets for later in the year, arguing that Bitcoin’s longer-term bullish cycle (post-2024 halving) is still intact.

Not everyone is immediately bullish, however. Some analysts caution that macro uncertainties could keep Bitcoin range-bound or even push it lower in the short term. Marcel Heinrichsmeier, a crypto asset analyst at DZ Bank, believes the recent downturn was driven largely by macroeconomic jitters – from slowing U.S. growth to Trump’s trade war – and warns those pressures have not fully abated. If geopolitical risks or economic data worsen in April, investors could yet seek refuge away from risk assets. Skeptics also note that crypto-specific events have hurt confidence: the late-February $1.5 billion hack of the Bybit exchange and a high-profile meme coin scandal both shocked the market and “contributed to a generally worse mood… than at the beginning of the year,” according to one analyst. With sentiment fragile, traders are closely watching early April catalysts – in particular, whether Trump’s tariff measures set to kick in on April 2 are softened or delayed. Any relief on the trade front “may bring the next big market catalyst” for a crypto rebound, Søndergaard told Cointelegraph. Conversely, an escalation of trade tensions could trigger another risk-off bout.

Investment Opportunities and Risks in the Current Climate

Despite the recent volatility, industry veterans note that Bitcoin is still up significantly year-on-year, and they see the current dip as a potential opportunity – albeit one paired with noteworthy risks. Here’s a look at both sides of the coin:

Opportunities

• “Buy the Dip” Mentality: Crypto bulls argue that Bitcoin’s pullback from $109K offers a chance to accumulate at a relative discount. Even after sliding 20%+, Bitcoin remains higher than it was prior to Trump’s election, and long-term believers remain unfazed. “Buy the dips!!!” tweeted Eric Trump, the president’s son, during the sell-off, reflecting a common sentiment among Bitcoin enthusiast. Many point out that Bitcoin has historically emerged stronger after corrections, often reaching new highs following major pullbacks in past cycles.
• Institutional Adoption: Under the radar, institutional investors have been buying. Regulatory filings in the U.S. show that hedge funds remain the dominant crypto buyers, but even some banks and sovereign wealth funds increased their Bitcoin exposure via newly launched spot Bitcoin ETF. For example, Abu Dhabi’s Mubadala Investment Co. disclosed a nearly $437 million stake in BlackRock’s Bitcoin ETF. This continued institutional interest implies confidence in Bitcoin’s long-term value and could help stabilize prices. If more large players enter the market (potentially spurred by clear regulations), it could fuel the next rally.
• Policy and Regulatory Catalysts: The Trump administration’s crypto-friendly stance, while slow to impact prices so far, could still yield positive catalysts in the coming months. Analysts note that a “clearer regulatory framework or a major catalyst – such as additional ETF approvals or policy shifts – seems to be necessary” to decisively shift market sentiment back to bullish. Should Washington deliver concrete action (for instance, approving new crypto ETFs, clarifying tax rules, or easing banking restrictions for crypto firms), it may unleash a wave of pent-up demand. Trump has pledged to make the U.S. “the crypto capital of the world,” so any follow-through on those promises – such as hints of a U.S. strategic Bitcoin reserve or other pro-crypto policies – would be seen as a bullish signal by investors.
• Macro Relief on the Horizon: Easing macro pressures later in the year could remove some of the weight on Bitcoin. Markets are currently pricing in the likelihood that the Fed will begin cutting interest rates in the second half of 2025 as economic growth slow. If inflation comes under control and the Fed pivots to monetary easing sooner, high-liquidity assets like Bitcoin might attract fresh inflows. Likewise, a resolution of ongoing trade disputes or geopolitical tensions would improve risk sentiment broadly. Crypto market analysts are closely watching early April talks on tariffs; any de-escalation of the trade war narrative could spark a relief rally across crypto market.

Risks

• Continued Macro Uncertainty: The flipside of the macro coin is that economic and policy uncertainty remains high. Trump’s tariff showdown with major trading partners is still unfolding, threatening to weigh on global growth and risk assets until at least a compromise is reached. Meanwhile, the Federal Reserve has signaled it won’t hesitate to keep monetary policy tight if inflation stays elevated. High interest rates throughout 2025 would make the investment environment challenging for Bitcoin, as investors may prefer yield-bearing safe havens over volatile crypto. “The macroeconomic situation has been the main reason for the price decline,” DZ Bank’s Heinrichsmeier noted during the latest drop, warning that broader market jitters could persist. In short, Bitcoin’s fate is tied to the economy more than ever – a bad recession or new inflation spike could hinder its performance in the near term.
• Regulatory/Legal Setbacks: While the U.S. government is more crypto-friendly under Trump, the industry is not entirely out of the woods on regulation. Delays in establishing clear rules – or worse, an unexpected regulatory crackdown – remain a risk. Observers point out that Trump’s much-touted crypto working group has yet to deliver concrete policy, and until it does, uncertainty will linger. Additionally, any negative news such as enforcement actions (e.g. if states or other countries impose strict crypto rules) or legal disputes could hurt market confidence. The memory of past U.S. regulatory moves lingers; for instance, the SEC’s actions in previous years caused temporary market dips. Investors are awaiting clarity on issues like crypto taxation, stablecoin oversight, and exchange licensing – without it, institutional adoption may be slower than hoped. Gabe Selby of CF Benchmarks emphasizes that only when a robust framework is in place will sentiment shift decisively bullish.
• Market Volatility and Technical Risks: Bitcoin’s notorious price volatility is a double-edged sword. In the current climate, sharp swings could continue. Some traders remain wary that a break below key support (around $75,000) could trigger another leg down – several forecasts have floated the possibility of a dip toward $65,000 if selling intensifies. Such a move, while not consensus, cannot be ruled out if bearish momentum resumes or if leveraged positions get liquidated. Additionally, the crypto market’s structure poses risks: liquidity can dry up on weekends or off-hours, exacerbating moves, and derivatives market leverage means small price changes can cascade. New investors who bought near the top are now underwater and could capitulate if prices don’t recover quickly, adding selling pressure. Technical analysts are watching the $80K level (approximately where Bitcoin is now) – a decisive break below that could signal further weakness, whereas strength above $85K–$90K in April would indicate a bullish turnaround. Until a clear trend emerges, volatility itself is a risk that traders must manage carefully.
• Security Breaches and Scams: The crypto sector’s operational risks were starkly illustrated by recent events. Last month’s massive hack of the Bybit exchange, which resulted in $1.5 billion in losses, shook confidence in the security of crypto platforms. Around the same time, a scandal involving a fraudulent meme token (promoted by a prominent figure abroad) roiled markets. These incidents, coming on the heels of earlier exchange failures, remind investors that hacking and fraud remain ever-present dangers in this nascent industry. “One of the biggest thefts of all time” and other high-profile breaches have highlighted the vulnerabilities of crypto infrastructure. Such episodes can prompt sudden sell-offs (as users rush to withdraw funds or fear contagion) and may invite stricter regulation. Beyond hacks, issues like blockchain glitches or smart contract bugs could also disrupt the market unexpectedly. Investors should be mindful that alongside price risk, crypto carries technology and custody risks – using reputable platforms, practicing good cyber hygiene, and diversifying exposure are crucial in the current climate.

After a whirlwind start to 2025, Bitcoin finds itself well off its peak but far from defeated. The coming month looks to be a pivotal one: traders are waiting to see if April brings clarity on U.S. trade policy and crypto regulation, which could restore some confidence, or if macro and crypto-specific risks deepen the correction. For now, the market’s mood is one of cautious optimism – tempered by hard lessons from the post-inauguration tumble. As Bitcoin hovers around $84,000 in late March, all eyes are on the next signals out of Washington and Wall Street to gauge where the volatile asset heads next. Will Bitcoin spring back toward its highs, or test new lows? April should offer a clearer direction for the crypto flagship, as investors navigate this crossroads of opportunity and risk in the evolving Bitcoin saga.