Recently, the crypto market rebounded significantly on Monday. Meanwhile, the United States and China announced an agreement to temporarily lower tariffs on goods for each other, sending a signal that trade tensions are easing.
According to Bloomberg, the agreement was announced through a joint statement released in Geneva, providing a 90-day window for the two countries to further negotiate on economic cooperation. According to the agreement, China has reduced the tariff on US goods from 125% to 10%, while the United States has lowered the tariff on Chinese imports from 145% to 30%.
This news quickly triggered a strong reaction in the global financial market. Both the global market and the crypto market have soared. The Hang Seng Index rose by 2.7%, and the Hang Seng Tech Index soared by 4.5%, completely reversing the downward trend since the tariff upgrade on April 2. The Bloomberg Spot Index for the US dollar rose by 0.3%. The US dollar strengthened simultaneously against the euro and the Japanese yen, and risk aversion sentiment eased somewhat.
The crypto market has also taken off simultaneously. Bitcoin (BTC) soared to $105,322, with a 24-hour increase of 1.62% and a cumulative rise of 11.35% over the past week (data from CoinMarketCap). Ethereum (ETH) followed closely behind, rising by 3.13% in a single day. Its current quote is $2,560, with a seven-day increase of over 40%. DOGE led the gains among mainstream altcoins, rising by 6.29% in a single day and increasing by as much as 42.5% in a week.
At present, the total market capitalization of the crypto market has exceeded $3.38 trillion, rising by 2% within the day. Market sentiment remains high, with the Fear and Greed index showing 73 (Greed), clearly leaning towards the bulls. Furthermore, popular currencies such as MOODENG and GOAT have both recorded gains of more than 50% in the past 24 hours, reflecting that the current market is in a typical Risk-On state.
Although this tariff reduction is still of a temporary nature, many market observers believe that it may become a potential turning point in US-China relations and will continue to provide macro support for the crypto market. Since the beginning of April, the United States and China have been in a trade deadlock when former President Trump reimposed high tariffs. This joint operation marks the first substantive “cooling down” move and is regarded as a potential policy inflection point.
It is worth noting that despite a bullish market sentiment, southbound funds have faced pressure to cash out, with an outflow of nearly 13 billion Hong Kong dollars. However, the sentiment in the crypto market remains strong. The total trading volume of BTC and ETH has exceeded 70 billion US dollars, and the bullish sentiment has not been significantly affected.
Analysts point out that if the subsequent negotiations go smoothly and a longer-term trade agreement is reached, both the traditional stock market and the digital asset market are expected to witness a new round of upward space. The current macro environment is providing stronger risk appetite support for crypto assets.
Furthermore, last week, former President Trump explicitly expressed his support for cryptocurrencies. He claimed that cryptocurrencies are a key front for maintaining the dominance of the United States and preventing China from taking control of this field. On his way back to the White House from Palm Beach, Florida last Sunday night, Trump told the media, “I strongly support cryptocurrencies because I don’t want them to fall into China’s hands.”
This statement emerged against the backdrop of increasingly fierce technological competition between the United States and China, where the two sides are constantly competing in cutting-edge technological fields such as artificial intelligence and blockchain. Trump also added that cryptocurrencies are “a completely new thing that emerged not long ago”, once again emphasizing the explosive growth of the industry. At the same time, he expressed concerns, arguing that if the United States does not take proactive measures, China’s influence in the technology sector may extend to the cryptocurrency sector. The United States must take the initiative in the crypto race to prevent China from seizing the commanding heights of the future financial system by taking advantage of the situation.
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