Bitcoin Jumps Back Above $88K as Stocks Reverse Early Losses

After hitting an intraday low of $81,500, Bitcoin (BTC) has staged a sharp recovery, surging back above $88,000 as both crypto and equity markets bounced from their worst levels.

For weeks, risk assets have been under pressure due to uncertainty surrounding President Trump’s aggressive trade policies. The implementation of new tariffs on Mexico, Canada, and China initially sent markets lower, but a wave of late buying helped fuel a turnaround.

The Nasdaq, which was down nearly 2% earlier in the session, is now up 0.7%, while the S&P 500 has trimmed its losses to just 0.25%. Meanwhile, Bitcoin is now up 1.5% on the day, while Ether (ETH) remains flat at $2,171.

Another Wild Swing for Bitcoin

Bitcoin has been on a rollercoaster over the past 10 days. After tumbling more than 20% from $109,000 to just above $78,000, it quickly rebounded over 20% to reach $95,000, only to pull back again. Today’s recovery marks another major shift in sentiment.

Crypto-related stocks are also seeing gains, with MicroStrategy (MSTR) up 11%, Coinbase (COIN) climbing 4%, and Marathon Digital Holdings (MARA) rising 5%.

Traders Bet on Fed Rate Cuts

The broader market downturn may be setting the stage for a Federal Reserve policy shift.

A few weeks ago, traders had largely dismissed the possibility of interest rate cuts in 2025. However, a combination of weaker economic data, escalating tariffs, and financial market volatility has caused expectations to shift.

Markets are now fully pricing in at least three rate cuts this year, with the first likely coming as early as May. The 10-year Treasury yield has also pulled back sharply, dropping from 4.80% at the time of Trump’s inauguration to 4.15% today.