Bitcoin’s recent rally above $93,000 reflects a broader market resurgence following Treasury Secretary Scott Bessent’s comments about improving US-China trade relations. Major altcoins also posted gains, while short traders faced significant losses due to increased liquidation. Optimism in both crypto and stock markets signals a potential conclusion to the trade dispute, prompting a positive shift in investor behaviour.
On Tuesday, Bitcoin surged past $93,000 for the first time since March, stimulating significant gains across the crypto market. Major altcoins, including Ethereum, XRP, and Solana, rose by 11%, 5%, and 6%, respectively. The overall crypto market increased by over 5%, reflecting robust performance in the meme, AI, and real-world asset sectors, which collectively saw notable rebounds.
This upward movement has led to major liquidations for short traders, who incurred losses exceeding $500 million within a single day. Data from Coinglass highlighted that over $581 million in futures liquidations occurred, with short positions facing the brunt of this trend as long-term holders began accumulating Bitcoin.
Evidence from CryptoQuant illustrates that long-term holders (LTH), defined as those possessing Bitcoin for more than 155 days, are increasing their holdings, while short-term holders (STH) continue to liquidate their assets. This shift indicates rising confidence among long-term investors towards Bitcoin.
Supporting this rally, Treasury Secretary Scott Bessent stated that the ongoing trade dispute between the US and China is unsustainable and indicated potential de-escalation. President Donald Trump echoed these sentiments, asserting plans to reduce tariffs significantly, which further buoyed market sentiment.
Concurrent with the crypto surge, major US stock indices posted gains of over 2.5%, aligning with Bitcoin’s rise. Previous speculation of Bitcoin decoupling from traditional stocks was briefly dispelled as both markets maintained a correlated rally, suggesting renewed optimism around an impending resolution to the US-China trade tensions. Investors should approach the market with caution given the associated risks, ensuring thorough analysis before engaging in investments.
