During President Donald Trump’s notable April 2 “Liberation Day” tariff declaration, the S&P 500 Index momentarily encountered a volatility similar to Bitcoin, highlighting the fear and uncertainty pervading conventional markets amidst the continuing trade war. Bloomberg’s Eric Balchunas brought to his followers’ attention that the volatility of the S&P 500, as shown by the “SPY US Equity Hist Vol” chart, hit 74 in early April, surpassing Bitcoin’s BTCUSD 71 level.
This surge represents a substantial departure from the S&P 500’s long-standing average volatility, which is typically under 20. However, Bitcoin has consistently experienced high volatility since its inception. In fact, according to BlackRock, “Bitcoin’s volatility remains high at 3.9 and 4.6 times that of gold and global equities, respectively.”
Trump’s trade war, which proposed tariffs ranging from 10% to 50% on imports from America’s major trading partners, has created crisis-like volatility in the stock market. Although Trump has since temporarily halted some of his imposed tariffs, the administration has escalated duties on Chinese imports to at least 145%. This volatility has also impacted other assets, most notably US Treasuries, which saw a significant sell-off this week. The 10-year Treasury bond yield is on pace for its most drastic increase since 2001.
Despite the “macro relief” brought about by the historic relief rally in the US equity markets on April 9 following Trump’s tariff pause, Bitcoin and its spot exchange-traded funds (ETFs) did not significantly benefit. Bitfinex analysts suggested in a note to Cointelegraph that “institutional confidence remains cautious in the near term.”
Bitfinex expressed optimism for the asset class from the second quarter through the end of 2025, citing “new narratives taking hold,” such as sovereign accumulation and the growth in real-world asset tokenization. Joe Burnett, Unchained’s Director of Market Research, echoed this sentiment, arguing that Bitcoin possesses more appealing attributes for long-term investors concerned about the impact of government policy and fiat risk on their portfolios. While the volatility spike in the S&P 500 is likely to be transient, its recent performance “challenges the belief that traditional markets are safer, less risky, or more stable.”
