Cryptocurrencies bounced on Monday with bitcoin (BTC) surpassing $100,000 as concerns over a full-blown trade war significantly subsided with Mexico reaching an agreement with U.S. President Donald Trump.
Mexico President Claudia Sheinbaum said on Monday that the government will deploy 10,000 troops on the U.S. border to stop illegal arms and drug trafficking. She also said that tariffs will be delayed for a month. Underscoring the sudden sentiment change, odds on prediction marketplace Polymarket that Donald Trump will remove blanket tariffs against Mexico before May spiked to 80%, up from around 50% earlier today.
Soon later President Trump signed an executive order to create a U.S. sovereign wealth fund, driving crypto markets higher. The Treasury and Commerce Departments are set to spearhead the effort, and with both departments led by pro-crypto secretaries, the vehicle could potentially open the way for the government to buy and hold digital assets.
Bitcoin surged to just shy of $102,000 from its Monday lows of $91,300 after the overnight capitulation, and was up 3.5% on the day, TradingView data shows. XRP advanced 40% from its lows to $2.7, erasing all its overnight losses. Solana’s SOL also nixed losses advancing to $210, up more than 5% on the day. Ethereum’s ether (ETH) rallied above $2,700 from near $2,000, but was still 7% lower over the past 24 hours.
U.S. stocks narrowed earlier declines by about half, with the Nasdaq closing the session lower by 1.2% and the S&P 500 0.76%.
“Bitcoin saw a decline in response to the tariff news, but the sell-off was more pronounced due to bitcoinʼs nature as a tail-risk asset, which tends to experience sharper declines when market sentiment weakens,” Bitfinex analysts said in a Monday report.
“While BTC remains sensitive to macroeconomic factors, it is also exhibiting structural strength on higher timeframes, suggesting that despite ongoing economic uncertainties, US policy changes, and broader risk asset corrections, it remains in a robust trend despite short-term volatility,” the authors added.
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