Bitcoin roared back above $90,000 Wednesday as global policy shifts created a perfect storm for risk assets. Here’s why crypto markets are celebrating and what experts say could come next.

Donald Trump’s surprise decision to delay auto tariffs on Canada and Mexico sent risk markets higher across the board, with Bitcoin leading the crypto recovery. The one-month tariff postponement, announced just a day after implementation, helped ease investor concerns about escalating trade tensions.

The positive momentum wasn’t just about tariffs. Germany’s plans to loosen debt limits for infrastructure spending and China’s decision to increase its target budget deficit added fuel to the recovery. These coordinated policy shifts created ideal conditions for risk assets to bounce back from their early-week slump.

Bitcoin climbed 3.7% over 24 hours to cross the $90,000 threshold, while several altcoins posted even stronger gains. Bitcoin Cash (BCH), Chainlink (LINK), and Aptos (APT) all recorded double-digit percentage increases as the market turned decidedly green.

Traditional markets also responded positively, with the Nasdaq gaining 1.2% and the S&P 500 rising 1.5% during afternoon trading. Crypto-related stocks benefited as well, with Coinbase shares climbing 3.5% and MicroStrategy jumping nearly 10%.

What makes this recovery particularly interesting is that the U.S. dollar index (DXY) continued its decline, reaching its lowest level since early November. Typically, risk-off episodes drive investors toward the dollar, which pressures crypto prices downward. Instead, the dollar is now more than 5% below its mid-January peak.

“With Fed rate expectations shifting back to pricing more rate cuts than less in 2025 and with bitcoin capable of shining as a store of value asset, we believe there are plenty of reasons to expect bitcoin to be well supported on dips,” said Joel Kruger, market strategist at LMAX Group.

Swissblock’s Bitcoin Fundamental Index (Credit: Swissblock)

Perhaps most encouraging for long-term Bitcoin holders, analytics firm Swissblock noted that despite recent price volatility, their Bitcoin Fundamental Index – which measures the network’s overall health – remained resilient.

“Bitcoin’s fundamentals are on the verge of shifting into the bullish quadrant, with sustained improvements in liquidity and network growth,” Swissblock analysts said in a Telegram broadcast. “This strength suggests that BTC is unlikely to be driven into a bear market.”

While geopolitical risks and trade tensions continue to influence market sentiment, Bitcoin’s strong response to positive policy developments suggests underlying strength that could propel the leading cryptocurrency to new heights if favorable conditions persist.