Bitcoin Blasts Past $93K After US-China Trade Shift — But Can It Last?

Bitcoin Surges Past $93,000 on US-China Tariff Optimism, But Concerns Remain

Bitcoin soared to its highest level since March, exceeding $93,000 on Tuesday afternoon, fueled by a surge in demand and positive geopolitical developments. This rally was triggered by consecutive statements from high-ranking US officials indicating a softening stance on trade tariffs with China. While the immediate market reaction was bullish, underlying on-chain data and ETF flows reveal potential limitations to further upside.

Washington Signals Trade De-escalation, Markets Respond

Bitcoin's rally followed reports that Treasury Secretary Scott Bessent informed institutional investors at a JPMorgan event that the US-China tariff trade war is unsustainable and will soon de-escalate. He characterized the current situation as a "trade embargo." Hours later, President Trump reportedly confirmed this direction, stating that US tariffs on Chinese goods will be significantly reduced. He also dismissed speculation regarding the potential dismissal of Fed Chair Jerome Powell.

These combined announcements shifted market sentiment towards risk-on behavior. Bitcoin, already experiencing gains, reached a session high of $93,400. At the time of writing, Bitcoin is trading at $93,709.

Altcoins Mirror Bitcoin's Surge

Ethereum (ETH) climbed over 8%, surpassing $1,700. Dogecoin (DOGE) saw an 8.6% increase, and Sui (SUI) rose by 11.7%. Broader crypto indices experienced a 5.2% rise during the same period. Traditional markets also participated in the rally, with the S&P 500 and Nasdaq gaining 2.5% and 2.7%, respectively. Gold, after reaching a record high of $3,500 earlier in the day, closed down 1% as capital flowed into riskier assets and inflation hedges.

Institutional Activity Increases, But Liquidity Remains a Concern

QCP Capital noted the reappearance of the "Coinbase premium," suggesting increased US institutional demand. They also highlighted growing capital inflows into US-listed spot Bitcoin ETFs. Farside Investors reported net inflows of $381 million on Monday and $107 million the previous Thursday.

QCP stated in a Telegram update that BTC and gold are benefiting from a unwinding of USD risk, attributing the recent move to capital fleeing inflation-sensitive assets.

However, analysts voiced concerns regarding liquidity. USDT, a key indicator of market liquidity, only grew by $2.9 billion in the last two months, significantly below the $5 billion growth observed during previous strong BTC rallies. This limited liquidity is speculated to potentially cap further price increases. One post on X (formerly Twitter) characterized the current BTC move as "classical FOMO behavior."

On-Chain Data Points to Resistance and Weak Demand

Despite the positive news, CryptoQuant reported a cautious outlook from analysts. A Tuesday report revealed a decrease in Bitcoin demand of 146,000 BTC over the past 30 days. While an improvement from March, this figure remains negative. Furthermore, CryptoQuant's demand momentum metric reached its lowest point since October 2024. The firm also highlighted resistance between $91,000 and $92,000, referencing it as the "Trader's On-chain Realized Price" level, a significant barrier during bearish periods.

CryptoQuant concluded that the on-chain bull score is bearish, stating that a significant improvement in sentiment is needed to break through this resistance and sustain gains.

Analysis: A Bullish Move with Underlying Weakness

While Bitcoin's surge above $93,000 represents a strong short-term move reflecting increased confidence due to geopolitical clarity, it faces significant challenges. Low liquidity, weak demand, and technical resistance are likely to hinder further price action.

A sustained breakout will require greater economic policy clarity, consistent ETF inflows, and increased on-chain activity. Until then, the crypto market is likely to fluctuate within its current range and remain susceptible to macroeconomic news and sentiment shifts.

Conclusion

Bitcoin's climb above $93,000 in 2025, driven by optimism surrounding US-China tariff negotiations and capital flows, is noteworthy. However, as with previous crypto rallies fueled by external catalysts, long-term sustainability remains questionable without stronger underlying market fundamentals. Investors should closely monitor geopolitical developments and on-chain data in the coming days.

FAQs

• What caused Bitcoin to exceed $93K? Positive developments in US-China trade tariff negotiations, with statements from Treasury Secretary Bessent and President Trump indicating tariff reductions, boosted risk appetite and drove Bitcoin's price higher.
• Are altcoins following Bitcoin's lead? Yes, altcoins such as Ethereum (ETH), Dogecoin (DOGE), and Sui (SUI) also experienced significant gains, reflecting broader crypto market demand.
• What are analysts saying about market stability? Despite the price increase, analysts express concerns about underlying weakness, citing low demand and liquidity as potential obstacles to sustained growth. CryptoQuant highlights bearish on-chain indicators.
• Is institutional money returning to crypto? Data from QCP Capital and Farside Investors suggests renewed institutional interest, evidenced by inflows into spot BTC ETFs and the reappearance of the Coinbase premium.
• What factors are hindering further Bitcoin price increases? Resistance at the $91,000–$92,000 level, weak demand momentum, and low liquidity are key obstacles.

Glossary

• Bitcoin (BTC): The first and largest cryptocurrency by market capitalization, characterized as a decentralized and deflationary asset.
• Altcoin: Any cryptocurrency other than Bitcoin.
• Coinbase Premium: The price difference between BTC on Coinbase and other exchanges, serving as an indicator of US demand.
• On-chain Data: Data derived from blockchain activity, used to analyze investor behavior and sentiment.
• USDT (Tether): A stablecoin pegged to the US dollar, utilized as a measure of crypto market liquidity.

References

• CoinDesk
• TokenPost
• Live Bitcoin News