Bitcoin’s Price Soars After Trump’s Tariff Suspension
Bitcoin saw a substantial boost on Wednesday after President Donald Trump announced a 90-day halt on tariffs on social media, propelling the cryptocurrency’s value by over 7% to $82,305.55, as reported by Coin Metrics. This surge followed a drop to $74,567.02, marked by a temporary rise in the U.S. Treasury’s 10-year yield above 4.51%, subsequently retracting from this level.
Notably, major cryptocurrencies such as Ether, Dogecoin, and XRP, each witnessed gains exceeding 12%, with Solana leading the way with a remarkable increase of over 14%. Additionally, Bitcoin proxy stock MicroStrategy, now known as Strategy, observed a substantial spike of 23%, while Robinhood’s stocks surged by 24% and crypto exchange Coinbase also experienced a notable gain of nearly 17%.
Bitcoin’s price surge paralleled the S&P 500 index’s most significant rally since 2008. Trump’s announcement on Truth Social stated, “I have authorized a 90-day PAUSE, and a substantially lowered Reciprocal Tariff during this period of 10%, also effective immediately,” along with plans to increase tariffs on China to 125%.
Ben Kurland, CEO of cryptocurrency research platform DYOR, offered valuable insights into the situation. “Trump’s 90-day tariff pause acts as a strategic breather, easing short-term market pressures while maintaining leverage. This move provides momentary stability for businesses, but won’t lead to significant shifts in supply chains or investment strategies,” Kurland stated. Despite the temporary relief, he emphasized that the underlying uncertainty persists.
The anticipated drop below $80,000 for Bitcoin was in line with its trading patterns between $80,000 and $90,000 this year, especially following its peak in January. The cryptocurrency’s price movements are closely connected to the equities market, with investors seeking clarity on the Trump administration’s tariff plans amid a lack of clear growth drivers in the crypto sector.
Zach Pandl, head of research at Grayscale Investments, suggested that Bitcoin may continue to fluctuate alongside tech stocks daily, advising long-term investors to position themselves for sustained dollar weakness and ongoing inflationary pressures. Bitcoin is currently down around 12% year-to-date and has dropped nearly 25% from its all-time high.
In summary, Trump’s recent announcement revitalized Bitcoin and other cryptocurrencies, highlighting the interconnection between traditional markets and digital assets. As investors navigate this evolving landscape, attention remains on the long-term implications of trade policies and market dynamics. The current scenario emphasizes the need to stay vigilant amidst ongoing uncertainties, underlining the cryptocurrency market’s sensitivity to macroeconomic developments.
