The cryptocurrency market rebounded sharply following U.S. President Donald Trump’s decision to temporarily suspend proposed tariffs on Canada and Mexico. This move, aimed at fostering continued negotiations, eased investor concerns and fueled a rally across major digital assets.
Bitcoin, which had dropped to a low of $92,000 on Sunday, surged past the $100,000 mark, reaching $101,731 the next day. Similarly, Ethereum saw a significant recovery, climbing from $2,451 to $2,880.
Tariff Suspension and Market Reactions
On February 3, Canadian Prime Minister Justin Trudeau confirmed that, after discussions with President Trump, the planned 25% tariffs would be delayed for at least 30 days. Canada committed to strengthening border security measures, including appointing a Fentanyl Czar, increasing personnel, and enhancing surveillance efforts.
In Mexico, President Claudia Sheinbaum also announced that tariffs would be paused for one month, as both nations work on joint agreements concerning security and trade. However, Trump later stated in an interview with Bloomberg TV that tariffs remain a possibility if agreements are not finalized.
Crypto Market Confidence Returns
The tariff suspension led to renewed confidence in the crypto market, with the Crypto Fear & Greed Index moving into greed territory with a score of 72 out of 100, indicating positive investor sentiment.
Market analysts suggest that easing trade tensions could further stabilize global financial markets, encouraging risk appetite among crypto investors. As regulatory uncertainty continues to shape market dynamics, the next steps in U.S. trade negotiations could play a crucial role in determining future price movements in the cryptocurrency sector.
