Donald Trump's Tariff Delay Sends Bitcoin (BTC) Price Higher

In the latest whipsaw of headlines this week, Donald Trump's tariff delay Wednesday eased investor worries with bitcoin (BTC) leading the crypto market higher.

The latest installment of the ‘Everything Must Fall’ narrative saw a pause on Wednesday as U.S. President Donald Trump's administration confirmed a one-month delay on tariffs on auto parts coming from Canada and Mexico.

The move comes a day after the administration enacted the tariffs, sparking a sharp selloff in U.S. equities and cryptocurrencies.

The latest development comes as Germany's parliament approved a plan to ease debt limits for infrastructure spending and China's government set its 2024 economic growth and targeted deficit higher than expected. All of these signals bode well for a continuation of the recent risk-on trade.

Bitcoin (BTC) price rose above the $90,000 mark on Wednesday, gaining 3.7% over the past 24 hours.

Almost all assets in the broad-market CoinDesk 20 Index advanced, with bitcoin cash (BCH), Chainlink's LINK and Aptos' (APT) booking double-digit gains.

The tech-focused Nasdaq and the broad-market S&P 500 were also up 1.2% and 1.5%, respectively, in the afternoon hours of the session. Crypto-related stocks also climbed higher from the early week lows. Crypto exchange Coinbase (COIN) was up 3.5%, while the largest corporate bitcoin holder Strategy gained nearly 10%.

Trade tensions and geopolitical risk have taken center stage lately, pressuring risk assets like U.S. stocks and digital assets lower.

However, in a surprising turn of events, the U.S. dollar index (DXY) cratered to its weakest level since early November and is down more than 5% lower from its mid-January peak.

"With Fed rate expectations shifting back to pricing more rate cuts than less in 2025 and with bitcoin capable of shining as a store of value asset, we believe there are plenty of reasons to expect bitcoin to be well supported on dips," said Joel Kruger, market strategist at LMAX Group.

Crypto analytics firm Swissblock noted that despite the wild price swings over the past few days, the firm's Bitcoin Fundamental Index, which measures the overall health of the network, held up relatively well.

"Bitcoin's fundamentals are on the verge of shifting into the bullish quadrant, with sustained improvements in liquidity and network growth," Swissblock analysts said in a Telegram broadcast. "This strength suggests that BTC is unlikely to be driven into a bear market."