Bitcoin reached its highest level since February, nearing $100K, boosted by President Trump’s suggestion of a UK trade deal. The Federal Reserve’s recent decision to hold interest rates steady added to market optimism, although analysts caution that sentiment may be overextended.
Bitcoin hit the highest level in months, exceeding $99,000 early Thursday thanks, in part, to President Trump’s suggestion of a possible trade deal with the UK. The cryptocurrency is now tantalisingly close to its all-time high from March, with recent data showing an uptick of 2.6%, despite a retreat from a peak above $94,000 recorded by CoinGecko.
In a post on Truth Social, Trump announced a forthcoming press conference, suggesting that there’s a “MAJOR TRADE DEAL WITH REPRESENTATIVES OF A BIG, AND HIGHLY RESPECTED, COUNTRY.” The indications point towards a deal with the UK, as reported by sources in The New York Times. This deal could mark a significant shift in diplomatic relations, easing tensions that have arisen from tariffs imposed under Trump’s previous administration.
The ongoing relationship has seen the UK grapple with a 10% general tariff and a 25% tax on US imports in sectors like steel and automobiles. British officials have been pushing for relief, and the potential deal could alleviate some burdens. In return, the UK is expected to consider reducing its digital services tax alongside tariffs on U.S. agricultural goods.
The surge in Bitcoin’s price followed a temperate update from the Federal Reserve regarding monetary policy. The Fed decided to maintain the current rate range of 4.25%–4.50%. Chair Jerome Powell acknowledged existing uncertainties, yet remarked that the economy remains on stable ground. The stock market reflected this cautiously optimistic sentiment with moderate gains just under 1% for indices like the S&P 500 and the Dow.
However, analysts from Nansen have warned of potential over-optimism in market sentiment. Aurelie Barthere, a principal analyst for the on-chain analytics platform, observed that comments from Trump and Treasury Secretary Scott Bessent have led traders to believe that aggressive tariff escalations may not be on the horizon. She mentioned, “Markets seem to believe there’s a ‘Trump put’ under equities, Treasuries, and crypto, indicating a protective cushion for investors.
Yet Barthere urges caution, noting that while they forecast a 55% chance for Bitcoin to hit new all-time highs, the rally needs more solid validation. She pointed out that the current bullish momentum is starting to tighten, implying less opportunity for price-driven surprises ahead.
Marcin Kazmierczak, COO of RedStone, weighed in with a broader analysis, pointing out the shifting correlation of Bitcoin to traditional markets. Over the last year, Bitcoin has shown a variable correlation with the S&P 500, swinging between about -0.2 and 0.4, categorising it more as a diversifier rather than a traditional safe haven.
Finally, Nansen’s latest report highlighted concerns regarding overzealous speculation in the crypto market. It flagged a marked decline in the equity risk premium, now below 3%, suggesting traders might be underestimating the risks amid fragile consumption indicators, ongoing trade impasses with China, and rising core service inflation.
