Bitcoin is increasingly being discussed as a potential safe-haven asset during periods of trade tensions and economic instability. Historically viewed as highly volatile, it showed resilience during the 2018-19 trade war and the 2025 tariff crisis, leading to a growing perception of Bitcoin as a hedge in turbulent times. Its maturation in the financial market suggests a shift from pure speculation to a more structured investment choice, earning it a place among traditional safe havens.
Bitcoin is emerging as a point of interest in the safe-haven asset discourse, traditionally dominated by gold and US Treasuries. Amid rising global trade tensions, Bitcoin’s behaviour has hinted at its potential to preserve value during crises, despite its notorious volatility. This article explores Bitcoin’s evolving role as a hedge in times of economic uncertainty, particularly during trade-related upheavals.
Historically, safe-haven assets have been characterised by their ability to maintain value during crises. Gold and US Treasuries have long served this purpose due to their stability and liquidity. Investors seek out these assets to protect themselves against economic turmoil. In contrast, Bitcoin’s volatility raises questions about its place in the safe-haven category, though moments of stability have sparked interest regarding its value-preserving capabilities.
The 2018-2019 US-China trade war marked a significant period for Bitcoin, where it notably surged while traditional markets struggled. As tensions escalated, Bitcoin’s price surged from approximately $5,000 to over $12,000, showcasing its potential to function as a hedge. This period catalysed the perception of Bitcoin as “digital gold,” thanks to its fixed supply and decentralized nature, which allows it to be less affected by government policies.
In 2025, aggressive tariffs introduced by the Trump administration again tested Bitcoin’s resilience. Following announcements of sweeping tariffs, traditional stock indices like the Nasdaq and S&P 500 experienced massive declines. Nonetheless, Bitcoin held stable during this turmoil, suggesting that while it has not achieved complete independence from risk assets, it can act as a stabilising asset in uncertain times; its performance raised eyebrows among investors looking for safe havens.
Although Bitcoin’s performance during financial turmoil indicates a growing resilience, it is crucial to note that it remains subject to the same market forces as risk assets. Institutional adoption and advancements in market structure have contributed to its maturation as a financial instrument. Bitcoin is increasingly viewed not just as speculative but also as an essential tool for financial sovereignty, thanks to its portability and decentralisation.
Despite these developments, Bitcoin is not positioned to replace gold as a primary safe haven, nor is it universally viewed as a reliable asset due to its price volatility. However, its role as a potential hedge against economic instability continues to evolve. During both the 2019 and 2025 trade crises, Bitcoin demonstrated the capacity to behave like a hedge, highlighting its gradual shift towards becoming a recognised financial asset.
As Bitcoin integrates further into global markets, its implications as a potential safe haven asset raise interesting questions. Should Bitcoin cement its role in financial strategies, it could fundamentally alter portfolio construction and risk management approaches. While not yet a direct substitute for gold, Bitcoin is making strides towards being a viable option for investors navigating crisis scenarios, especially within the context of evolving geopolitical dynamics.
