Bitcoin rebounds 8.5% following drop caused by US tariff announcement, reaching $99,000 amid easing tensions with Mexico
After briefly plummeting to $91,500 earlier this week due to the US imposing tariffs against Canada and Mexico, Bitcoin experienced an impressive 8.5% rebound. This dip triggered a massive sell-off of risk assets. However, after an easing of trade tensions between Washington and Mexico, the market recovered, propelling the price of Bitcoin beyond $99,000.
The pause in Mexican tariffs calms the market
The pressure on risk assets diminished after Mexican President Claudia Sheinbaum announced a temporary freeze on tariffs. Following a discussion with US President Donald Trump, both leaders agreed to suspend the application of tariffs for one month in order to negotiate security and trade issues.
Sheinbaum specified that 10,000 members of the National Guard would be deployed to the northern border of Mexico to strengthen the fight against drug trafficking, particularly of fentanyl. Trump confirmed this truce on his platform Truth Social, stating that the discussions would be led by Marco Rubio, Scott Bessent, and Howard Lutnick, the Secretary of State, Treasury, and Commerce, respectively.
A contrasting impact on the crypto market
While Bitcoin quickly recovered its losses, altcoins bore the brunt of this volatility. Many cryptocurrencies in the top 20 by market capitalization dropped by more than 20% overnight, highlighting the fragility of the market in the face of macroeconomic shocks.
Nevertheless, this rebound of Bitcoin demonstrates its resilience as a safe-haven asset, with some investors seeing it as a protective value against geopolitical tensions and economic uncertainties.
Volatility that could persist
Despite this bounce back, the market remains dependent on political decisions and the outcome of negotiations between the United States and Mexico. If no agreement is reached within a month, a new wave of volatility could shake both traditional and crypto markets.
Investors will also be watching the Trump administration’s stance on European tariffs, which could become the next source of stress for Bitcoin and risk assets.
