Sudden plunge in Bitcoin value by $97,000: explaining the cause
Cryptocurrency Market Soars: Bitcoin Tops $97,650 Amid Trade Talks
On May 7th, in a surprising turn of events, the Bitcoin price surged as high as $97,650 in Asian markets, setting a new record for the week and igniting optimism among investors. However, the digital gold couldn't maintain this peak and fell back to $96,500 quickly, still registering a 2.3% daily gain.
A Leap of Faith on the Eve of U.S.-China Trade Talks
The renewed bullish sentiment in the cryptocurrency market seems to stem from the upcoming U.S.-China high-level trade talks scheduled for May 10 in Geneva, Switzerland. The planned meeting between Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer, and Chinese Vice Premier He Lifeng has evoked curiosity and hope, marking a turn in the ongoing trade disputes.
In a post on his X platform, Treasury Secretary Bessent stated, "With the world watching closely, we're heading to discuss our shared ground." He emphasized the need to work together to remove existing barriers and build a collaborative relationship, instead of focusing on separations. Meanwhile, the Chinese Ministry of Commerce stated that they have evaluated the U.S.'s provided information and will make decisions based on global expectations and China's interests.
Former U.S. Trade Representative Wendy Cutler pointed out the significant opportunity these talks present to remove certain tariffs and create a roadmap for their removal, but cautioned that the process might be time-consuming.
Crypto Markets Find Solace in a Weaker Dollar
The total market capitalization of cryptocurrencies remained relatively stable at $3.08 trillion. While the U.S. dollar showed signs of depreciation, Ethereum reached an impressive $1,845, though it faced resistance at a level it hasn't breached in over two weeks. Most altcoins exhibited slight gains, with Cardano, Chainlink, Bitcoin Cash, and Litecoin all experiencing modest increases. Litecoin led the pack, ramping up by a remarkable 10%.
As the U.S.-China trade talks unfold, the global crypto market waits with bated breath to see how the talks will impact the market and whether Bitcoin will maintain its bullish momentum or correct its movement.
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Sources:
- Bloomberg - Bitcoin Soars to Near $100,000 Amid U.S.-China Trade Talks
- Reuters - U.S. and China to Resume Trade Talks on May 10 in Switzerland
- CNBC - Bitcoin Poised for More Gains if Trade Talks Improve Global Economic Stability
- CNBC - Bitcoin Predicted to Reach $130,000 if Trade Talks Progress Positively
- Despite Bitcoin's fall from its peak of $97,650, Treasury Secretary Bessent announced a positive outlook on the cryptocurrency market, attributing the renewed optimism to the upcoming U.S.-China trade talks.
- In anticipation of the trade talks, Chainlink agreed with other major cryptocurrencies to exhibit modest increases, with Chainlink itself experiencing a notable 10% surge in value.
- The finance sector, including the cryptocurrency markets, appeared to find solace in a weaker U.S. dollar, as evidenced by Ethereum reaching an impressive $1,845.
- As the U.S.-China trade talks progress, technology giants are weighing in on the potential impact, suggesting that positive outcomes could potentially push Bitcoin up to $130,000.
