Bitcoin\u2019s potential price reaction to a trade deal between the United States and China could give insights into whether Bitcoin is being used as a safe-haven asset in the current market. <\/p>\n
Bitcoin (BTC<\/a>) outperformed stocks and held up \u201cincredibly strong\u201d during a sharp sell-off on stock markets in April, following Donald Trump\u2019s announcement of tariffs on \u201cLiberation Day,\u201d observed<\/a> crypto trader \u201cDaan Crypto\u201d on May 11.<\/p>\n Following its plunge to $75,000 on April 7, Bitcoin recovered strongly to trade 27% higher at around $95,000 by the end of the month. Meanwhile, indexes like the S&P 500 and Nasdaq declined in April.\u00a0<\/p>\n At the time, people wondered if Bitcoin\u2019s relative strength<\/a> came from the narrative that countries were using Bitcoin to bypass tariffs. The analyst said the opposite should theoretically occur if the trade deal is confirmed. <\/p>\n \u201cTheoretically speaking, if the trade uncertainty was what was making BTC outperform, it should stop outperforming after we hit the most important deal, which includes China.\u201d<\/p>\n Bitcoin performance since Trump\u2019s \u201cLiberation Day\u201d tariff announcement. Source: <\/em>Daan Crypto<\/em><\/a><\/p>\n On May 11, the White House announced<\/a> that talks between the US and China regarding a trade deal have made \u201csubstantial progress.\u201d However, no official agreement had been announced.<\/p>\n Related: <\/strong><\/em>Bitcoin must close the week above this level to start ‘price discovery 2’<\/strong><\/em><\/a><\/p>\n \u201cWe will be giving details tomorrow, but I can tell you that the talks were productive,\u201d said US Treasury Secretary Scott Bessent.<\/p>\n However, if Bitcoin keeps doing its thing and outperforming, \u201cit\u2019s safe to assume that tariffs likely have little direct impact on how BTC is treated or used,\u201d Daan concluded.\u00a0<\/p>\n Some analysts, however, believe that Bitcoin will likely jump if a trade deal comes through, along with potential rate cuts. <\/p>\n \u201cWe believe that institutional investors are less apprehensive about investing in Bitcoin and crypto as US-China trade talks come to a conclusion and the likelihood of rate cuts increases,\u201d Jeff Mei, chief operations officer at BTSE, told Cointelegraph.\u00a0<\/p>\n Meanwhile, Jupiter Zheng, researcher at HashKey Capital, said, \u201cA US-China trade deal could signal stability in global markets, potentially driving investors to seek growth opportunities and send capital into alternative assets.\u201d<\/p>\n \u201cBitcoin could also see new highs as a result, particularly if the deal weakens the dollar or leads to renewed liquidity flows into emerging markets.\u201d<\/p>\nMarkets await trade deal announcement\u00a0<\/h2>\n