Bitcoin Drops To $105,000 After Trump Warns He's 'No Longer Mr. Nice Guy'

by Murtuza J Merchant Benzinga Staff Writer

Zinger Key Points

Institutional investors remain hesitant due to Bitcoin’s unpredictable swings, preferring safer alternatives like gold.
Analysts say the coming 12-18 months will test whether Bitcoin can graduate from risk asset to portfolio hedge.
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Despite years of positioning as "digital gold," Bitcoin's BTC/USD swift drop below $105,000 reveals a sobering truth: the asset still trades like high-beta tech, not a geopolitical hedge, though experts believe a shift may be underway.

What Happened: After President Donald Trump on Friday declared on Truth Social that China had "totally violated" its trade agreement and warned that the U.S. is "no longer Mr. Nice Guy," markets responded swiftly.

Equities sold off, and Bitcoin, which had traded above $109,000 on Tuesday, retreated below $105,000 on early Friday.

That reaction prompted analysts and industry leaders to weigh in on what the move says about crypto's current and future position in institutional portfolios.

"Bitcoin's sharp drop underscores its sensitivity to macro shocks, challenging its narrative as a reliable hedge," Andy Lian, intergovernmental blockchain advisor and author, told Benzinga.

Lian acknowledged Bitcoin's growing appeal as a hedge against currency debasement and geopolitical instability but emphasized its continued volatility.

Also Read: Trump Administration Eyes Strategic Bitcoin Reserve As Part Of US Market Infrastructure Overhaul

"It still dances to the tune of broader risk sentiment, correlating with equities during stress events," he noted, adding that institutional adoption remains hesitant due to these large price swings.

Speaking with Benzinga, Lingling Jiang, partner at DWF Labs, echoed the sentiment. "Bitcoin dropped to three-week lows after Trump's tariffs on China and others. That tells us crypto is still very much trading as a risk-on asset," she said.

While Bitcoin is frequently touted as a hedge against inflation or global instability, Jiang said the data points in another direction: "Institutional flows still treat it like a high-beta tech play."

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Why It Matters: Both experts believe the current volatility may actually signal a turning point, not a failure.

"Markets are trying to figure out what Bitcoin's role should be in a world where trade wars are becoming the norm," said Jiang.

She believes this period of uncertainty could ultimately solidify Bitcoin's position as a strategic hedge, particularly if repeated geopolitical shocks normalize its use as a store of value.

Lian also pointed to a growing sentiment shift abroad.

He cited a recent Chinese academic article, republished by the International Monetary Institution, which frames Bitcoin as a potential "strategic reserve asset."

While not official policy, it suggests a possible rethinking of crypto's role even in traditionally skeptical jurisdictions.

Still, volatility remains the biggest hurdle.

"Retail investors may accept the risk, but institutions—pensions, endowments—crave predictability," Lian said, noting that some may prefer gold or stablecoins until Bitcoin's swings stabilize.

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