Bitcoin (BTC-USD) surged as much as $88,000 on Monday while stocks tanked, prompting one Wall Street strategist to note that the world’s largest cryptocurrency has outperformed the Nasdaq Composite (^IXIC) against the backdrop of a trade war.

“Bitcoin outperformance to Nasdaq has been striking all through the U.S tariffs crisis – Bitcoin is down 10% YTD vs. Nasdaq down 16% YTD,” Bernstein managing director Gautam Chhugani wrote on Monday before the market open. “We expect Bitcoin and broader global blockchain assets to play a defining role, amidst the deglobalization trends.”

Read more: The latest news and updates on Trump’s tariffs

Chhugani expects that bitcoin will benefit from the Trump administration’s efforts to build a regulatory framework around crypto, including “stablecoins” — tokens pegged to the US dollar.

“We believe, politically, the current U.S government sees crypto as a ‘main street’ proxy with focus on financial innovation (e.g., through stablecoins) beyond the ‘big banks,'” Chhugani wrote.

The analysts at Bernstein highlight how banks are closely looking at stablecoin technology for cross-border payments, interbank settlements, and other businesses, such as crypto custody, wealth management, trading, and investment banking.

Even Federal Reserve Chair Jerome Powell recently said stablecoins “could have fairly wide appeal” as regulations surrounding the digital assets have been introduced in Congress.

Bitcoin surged immediately following President Trump’s White House victory in November over expectations of pro-crypto policies, reaching an all-time high above $106,000 in January before pulling back.

While US assets have sold off in recent weeks, bitcoin has mostly held above the $80,000 level.

“The Bitcoin ETFs saw limited selling in Feb/March close to ~$4bn, but the selling seems exhausted in April amid the tariff crisis. Rising institutional holding within ETFs has led to more resilient capital within the Bitcoin ETFs,” Chhugani wrote.

If the United States were to purchase bitcoin to bolster a strategic reserve beyond the seized assets currently held by the government, that would be a positive catalyst, Bernstein analysts said.

Ines Ferre is a Senior Business Reporter for Yahoo Finance. Follow her on X at @ines_ferre.

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