Bitcoin Rises on Dovish Fed and Tariff Easing Hopes Amid Market Rebound

Bitcoin (BTC) surged 2.7% to around $86,500 early Monday during Asia trading hours, driven by improved risk sentiment amid reports that U.S. tariffs set for April 2 under President Donald Trump may be less aggressive than feared. Solana (SOL) jumped nearly 6% to $138, while XRP climbed 2.5% to $2.44, trading above its 50-day moving average after two weeks of gains, according to CoinDesk.

Markets responded positively to news that Trump's upcoming "reciprocal tariffs" may be more targeted, with some countries exempt and no cumulative increases on steel and metal duties, Bloomberg reported. February’s harsh market reaction to tariff threats saw BTC tumble nearly 17.6% below $80,000. However, investor sentiment has shifted thanks to recent dovish signals from the Federal Reserve and signs of easing trade tensions.

U.S. stock futures rose over 0.5% across the S&P 500, Dow Jones, and Nasdaq, while the VIX—Wall Street’s fear index—fell 2.5% to 18.88. Chinese markets also reversed early losses.

The Fed recently raised inflation expectations while lowering growth forecasts, acknowledging that tariff-driven inflation appears transitory. Despite the challenges, the central bank maintained its outlook for two rate cuts in 2025—a bullish sign for risk assets like cryptocurrencies.

Arthur Hayes, BitMEX co-founder and now CIO at Maelstrom, posted on X: “I bet $BTC hits $110K before it retests $76.5K... QT is turning into QE, and tariffs are just transitory. JayPow told me so.”

Key market events to watch include Friday’s PCE inflation reading and Senate hearings for SEC nominee Paul Atkins and OCC nominee Jonathan Gould on March 27. Investors are closely monitoring these signals as crypto and equities rebound.