Bitcoin (BTC) volatility climbed to 3.6% on March 19 — the highest point since August 2024, according to data from CoinGlass.

The volatility reflects heightened market uncertainty amid structural unknowns in the US economy, according to Uldis Tearudklans, chief revenue officer at UK-based cryptocurrency exchange Paybis.

“The policy landscape is becoming more complex with the emergence of Elon Musk’s Department of Government Efficiency,” Tearudklans said. “While the initiative to reduce government spending has bipartisan backing, the broader economic effects — particularly on employment and consumer demand — remain difficult to quantify.”

The Department of Government Efficiency claims to have generated an estimated savings of $115 billion for the US government as of March 19. The claimed savings include workforce reductions, asset sales, grant cancellations, and regulatory savings.

According to Tearudklans, if fiscal tightening proceeds alongside stable or gradually declining interest rates, the resulting liquidity contraction “could create a mismatch in policy direction, limiting the intended stimulative effect of future rate cuts.”

On March 19, the Federal Open Market Committee announced that it would leave interest rates unchanged for the time being, although it left open the possibility for two more rate cuts in 2025.

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Bitcoin’s volatility is well-known and has been on full display since US President Donald Trump was inaugurated in January 2025.

Since reaching a high of $109,590 on Jan. 20, BTC price suffered a 30% retracement to a low of $77,041 during the week of March 9-15. Selling pressure has increased as more short-term buyers currently find themselves down on their investments, though demand may be slightly returning. The cryptocurrency price bounced up to around $84,000 at this time of writing.

Tearudklans told Cointelegraph that the elevated volatility indicates that traders are pricing in divergent outcomes, including the possibility of fiscal contraction alongside stable or easing interest rates.

“This creates a complex feedback loop where reduced government spending could limit growth, potentially forcing the Fed to maintain a cautious stance or even delay future rate cuts.”

Bitcoin’s price action may also be tied to policy misalignment, he added. “While the Fed’s rate decision offers short-term clarity, the broader fiscal outlook introduces the risk of asymmetric market responses, reinforcing Bitcoin’s sensitivity to macroeconomic cycles and liquidity shifts.”

The volatility of Bitcoin comes as Trump has expressed overtures to the crypto community. On March 7, he signed an executive order to create a strategic Bitcoin reserve and digital asset stockpile in the United States. On March 20, he spoke at the 2025 Digital Asset Summit, claiming the US will be a “Bitcoin superpower.”

However, Trump’s talk of tariffs and rising geopolitical tension are affecting the financial markets as a whole, including crypto.

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