Institutional developments helped lift sentiment across crypto markets on Tuesday, with major players Vanguard and Bank of America moving to expand client access to digital assets.

Bitcoin rebounded sharply during U.S. morning trading, climbing back above $90,000 and reversing most of its steep slide from Sunday’s drop below $84,000. The benchmark cryptocurrency last traded near $91,180, up roughly 8% over the past 24 hours, buoying broad market performance.

Ether also regained momentum, jumping above $3,000 with a 9% daily gain. Large-cap altcoins joined the recovery as XRP, Solana’s SOL, and dogecoin advanced between 7% and 10%, clawing back losses from earlier in the week.

The market upswing coincided with a major shift from Vanguard, the $11 trillion asset management behemoth, which ended its longstanding ban on crypto products and will now allow clients access to digital asset ETFs. At the same time, Bank of America authorized its wealth advisors to recommend a 1%–4% allocation to spot bitcoin ETFs, further signaling rising institutional acceptance.

Japan bond-market risks loom over crypto

Despite the rebound, risks remain. Mark Connors, founder and chief macro strategist at Risk Dimensions and former head of risk advisory at Credit Suisse, warned that a potential jump in Japan’s 10-year government bond yield could siphon capital from global markets. Crypto — and bitcoin in particular — could face acute pressure due to their sensitivity to Asian liquidity cycles and elevated leverage. He highlighted Binance, which processes nearly half of global crypto trading volume and offers leverage up to 50x, as especially exposed to volatility in the yen and yuan.

Connors added that bitcoin appears to be leading declines in the S&P 500, a trend he expects could persist until the Federal Reserve and Bank of Japan hold their respective policy meetings later this month. Should markets deteriorate further, he anticipates some form of intervention, consistent with past episodes of financial stress.

Still, not all indicators point to downside risk. Jasper De Maere, desk strategist at Wintermute, said derivatives positioning shows a “clear lean toward bullish, short-vol behaviour.” Traders are actively selling downside puts in the $80,000–$85,000 range while selectively accumulating upside exposure.

“The mix suggests the market views $80,000–$85,000 as supported and is comfortable leaning long into year-end while earning carry along the way,” De Maere said — a sign that despite short-term volatility, participants may be positioning for a broader recovery.