Investors move $17B to stablecoins as tariffs loom

Cryptocurrency investors are increasingly shifting their capital into stablecoins and tokenised real-world assets (RWAs) as geopolitical tensions and economic uncertainty rise ahead of U.S. President Donald Trump’s April 2 tariff announcement.

Stablecoins, digital currencies pegged to fiat assets like the U.S. dollar, and RWAs such as tokenised real estate and fine art have gained traction as safer alternatives amid market volatility.

According to crypto intelligence firm IntoTheBlock, these assets are experiencing steady inflows due to their perceived stability in uncertain times.

“Stablecoins and RWAs continue to see steady inflows of capital as safe havens in the current uncertain market,” IntoTheBlock stated on March 31.

The anticipated tariffs aim to address the U.S.’s $1.2 trillion goods trade deficit by imposing reciprocal trade measures on key trading partners.

However, fears of a trade war have dampened investor sentiment globally, impacting both cryptocurrency and equity markets.

Bitcoin (CRYPTO:BTC) has fallen 19% since Trump announced initial tariffs on January 20, while the S&P 500 index has dropped over 7%.

Juan Pellicer, senior research analyst at IntoTheBlock, noted that geopolitical tensions and reduced growth expectations are driving caution among investors.

“Many investors were expecting economic tailwinds following Trump's inauguration, but increased geopolitical tensions, tariffs, and general political uncertainty are making investors more cautious,” he said.

Meanwhile, RWAs have reached a new cumulative all-time high of over $17 billion as of February 3, with projections suggesting they could surpass $20 billion soon.

Some experts believe their liquidity could attract a significant share of the global $450 trillion asset market, potentially driving RWAs to a $50 billion milestone by 2025.

Investor risk appetite remains muted amid macroeconomic uncertainty and tariff threats.

“Risk appetite remains muted amid tariff threats from President Trump and ongoing macro uncertainty,” stated Iliya Kalchev from Nexo, highlighting this sentiment.

As April 2 approaches, market participants remain vigilant about potential impacts on global trade and financial markets.

Tokenised assets and stablecoins may continue to serve as critical tools for navigating volatile conditions in the evolving economic landscape.