United States Treasury secretary Scott Bessent announced on Sunday that the US and China have achieved "substantial" progress on a trade deal framework. This development has ignited investor hopes for a resurgence of the bull market.
The proposed trade framework is expected to eliminate the need for the 100% additional tariffs that were announced by US President Donald Trump on October 10. Bessent stated that President Trump provided him with significant negotiating leverage through the threat of these tariffs, which were set to take effect on November 1. He believes a substantial framework has been reached that will avert these tariffs and allow for discussions on numerous other issues with China.
"President Trump gave me a great deal of negotiating leverage with the threat of 100% tariffs on November 1, and I believe we have reached a very substantial framework that will avoid that and allow us to discuss many other things with the Chinese."
Bessent's remarks come after weeks of easing trade tensions between the two economic powerhouses. This period of de-escalation culminated in President Trump confirming a meeting with China's President Xi Jinping at the Asia-Pacific Economic Cooperation (APEC) summit, scheduled for October 31.
Previously, President Trump had indicated there was "no reason" to meet with Chinese representatives, which had sparked investor fears of a new, protracted trade war between the two nations.
The news of the trade framework and the increased likelihood of a US-China deal was met with enthusiasm by crypto investors, traders, and industry executives. The crypto markets experienced a modest rally in response to the positive trade deal developments.
Crypto Markets Rally on Positive Trade Framework News
Crypto markets are known to be sensitive to developments in trade wars, typically rallying on positive news and declining when trade tensions escalate or global trade faces disruption.
President Trump's social media post on October 11, announcing the additional 100% tariffs on China, had previously triggered a significant crypto market meltdown. During that period, some crypto tokens saw their value plummet by up to 99% within a 24-hour span.
Following Bessent's announcement on Sunday, Bitcoin (BTC) saw a modest rally of 1.8%, Ether (ETH) increased by 3.6%, and SOL (SOL) rose by 3.7%.
Jeff Park, an advisor at investment company Bitwise, expressed his view that the positive US-China trade deal news would propel both BTC and gold to new all-time highs.
Investor and analyst Anthony Pompliano also commented on the potential market impact, stating: "Asset prices will get crazy this week if the US-China trade deal is announced and the Fed cuts interest rates. Buckle up."