Bitcoin (BTC) flirted with the $100,000 mark on Thursday, buoyed by significant gains in major cryptocurrencies such as Dogecoin (DOGE) and Cardano’s ADA. This upward momentum was largely driven by dovish signals from the Federal Reserve, as well as a potential trade deal hinted at by former U.S. President Donald Trump.
DOGE experienced a 5% increase while ADA climbed by 4%. Other notable cryptocurrencies such as ether (ETH), BNB Chain’s BNB, XRP (XRP), and Solana’s SOL recorded gains in the range of 2%-3%. The broad-based CoinDesk 20 index, which tracks the performance of the largest tokens, rose by 2.2%.
In a late Wednesday social media announcement, Trump stated that the U.S. will unveil a “big” trade deal with a “highly respected country” at a press conference scheduled for 10 a.m. ET, with multiple news outlets, including Bloomberg and The Financial Times identifying the country as the U.K. This anticipated announcement is expected to herald the beginning of numerous such trade agreements, which could reduce the prevailing tariff uncertainties that have plagued global markets.
Recent tariff concerns have significantly impacted both equities and commodities, and any improvement in these cost dynamics for U.S. businesses could act as a positive catalyst for risk assets, including cryptocurrencies.
Meanwhile, the Federal Reserve’s decision to maintain interest rates from their previous levels, taken on Wednesday, was largely expected. Nevertheless, market reactions suggest mixed opinions on the timeline for potential interest rate cuts. Data from the CME FedWatch Tool indicates a 55% probability for a July interest rate cut to the 4.00%-4.25% range, while traders are pricing in a total of 100 basis points of easing by the end of the year.
“Bitcoin is inching back up to $100k with the steady Fed rate decision and the prospect of future rate cuts gaining more traction among traders,” remarked Semir Gabeljic, head of Pythagoras Investments. He emphasized the uncertain landscape, stating, “Given the current administration’s influence on the Fed chair, anything is possible—uncertainty is the only certainty.”
However, some analysts have cautioned that policymakers may be entering a phase of stagflation, characterized by simultaneous high inflation, stagnant economic growth, and rising unemployment—conditions detrimental to economic health.
“The Federal Reserve is grappling with a growing policy dilemma that threatens both sides of its dual mandate,” stated Gabe Selby, head of research at CF Benchmarks. He pointed out that businesses are increasingly passing the rising tariff costs on to consumers, leading to expectations of renewed inflation over the next six months amidst a deteriorating employment outlook.
Selby noted that while CF Benchmarks still anticipates around 100 basis points of rate cuts by year-end, the Fed risks acting too late, potentially exacerbating economic hardships. “In this volatile macro backdrop, bitcoin has clearly emerged as a significant beneficiary,” he added, referencing the record inflows into U.S. spot bitcoin ETFs, including BlackRock’s IBIT, which has seen $4.3 billion influx in the past month.
Furthermore, Jupiter Zheng, a partner at HashKey Capital, emphasized that BTC’s recent price movements fall within a larger structural shift. “Bitcoin’s rise underscores its role as a hedge against macroeconomic and geopolitical volatility,” Zheng noted. “Investors are increasingly incorporating crypto as a fundamental component of resilient portfolios.”
Read more: Fed Stagflation Risk Signal Could Be Bullish for Bitcoin, Analyst Says
