The 40% likelihood of a U.S. recession in 2025 could significantly impact the crypto market. Economic uncertainty is heightened by Trump's trade tariffs.
Economic Uncertainty and Tariffs
According to Coin Bureau founder Nic Puckrin, the likelihood of a U.S. recession has increased amid macroeconomic instability. Tariffs imposed by President Donald Trump's administration and budget cuts could trigger this scenario. "Trump and his advisors have not completely dismissed the possibility of a recession, which makes it a credible risk," Puckrin noted.
Impact on the Crypto Market
Recent trade tariffs have already shaken the crypto market. Following the tariff announcement, Bitcoin's price sharply corrected by 24%, with altcoins faring even worse. Nansen research analyst Nicolai Sondergaard believes that crypto markets will remain under pressure from tariffs until at least April 2025.
Potential Crypto Market Recovery
Despite the negative outlook, some analysts see signs of recovery. 10x Research founder Markus Thielen noted that Bitcoin may have found a price bottom in March 2025. He suggests that changes in Trump's trade rhetoric could lead to a BTC price reversal.
While macroeconomic factors create instability, potential policy shifts and diplomatic breakthroughs could aid in the crypto market's recovery.
