Bitcoin Crosses $90K as Trump Delays Canada, Mexico Auto Tariffs

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Crypto Market Sees Relief as Tariff Delay Eases Investor Worries

The US government’s decision to delay tariffs on auto parts from Canada and Mexico by a month has brought relief to investors, with bitcoin (BTC) leading the crypto market higher. The news, announced just a day after the tariffs were initially imposed, has contributed to a rebound in risk markets, with the tech-focused Nasdaq and broad-market S&P 500 also rising.

Bitcoin Climbs Above $90,000

BTC climbed 3.7% over the past 24 hours, reaching levels above $90,000. The move was driven by a broad-based rally in the crypto market, with almost all assets in the CoinDesk 20 Index advancing. Bitcoin Cash (BCH), Chainlink’s LINK, and Aptos’ (APT) all booked double-digit gains.

Crypto-Related Stocks Surge

Crypto-related stocks also saw significant gains, with Coinbase (COIN) rising 3.5% and Strategy, the largest corporate bitcoin holder, gaining nearly 10%. The tech-focused Nasdaq and broad-market S&P 500 were also up 1.2% and 1.5%, respectively, in the afternoon hours of the session.

Fed Rate Expectations Shift

Trade tensions and geopolitical risk have taken center stage in recent weeks, weighing on investor sentiment and pressuring risk assets like US stocks and digital assets lower. However, the US dollar index (DXY) has crumbled to its weakest level since early November, down more than 5% from its mid-January peak. This shift in Fed rate expectations, with investors now pricing in more rate cuts in 2025, has created a more supportive environment for bitcoin and other cryptocurrencies.

Bitcoin Fundamentals Strengthen

According to Swissblock, a crypto analytics firm, the Bitcoin Fundamental Index, which measures the overall health of the network, has held up relatively well despite the recent wild price swings. "Bitcoin’s fundamentals are on the verge of shifting into the bullish quadrant, with sustained improvements in liquidity and network growth," analysts said in a recent Telegram broadcast. "This strength suggests that BTC is unlikely to be driven into a bear market."

FAQs

Q: What is the current state of the crypto market?
A: The crypto market is currently experiencing a rebound, driven by the delay in US tariffs on auto parts from Canada and Mexico.

Q: How did the market react to the tariff delay?
A: The market reacted positively, with bitcoin (BTC) climbing 3.7% over the past 24 hours and the tech-focused Nasdaq and broad-market S&P 500 rising 1.2% and 1.5%, respectively.

Q: What are the implications for the US dollar index?
A: The US dollar index (DXY) has crumbled to its weakest level since early November, down more than 5% from its mid-January peak, which is creating a more supportive environment for bitcoin and other cryptocurrencies.

Q: What does the future hold for bitcoin?
A: According to Swissblock, bitcoin’s fundamentals are on the verge of shifting into the bullish quadrant, with sustained improvements in liquidity and network growth, suggesting that BTC is unlikely to be driven into a bear market.