After the rapprochement between the US and China, is the crypto market in danger? Will liquidity exit?

The US and China concluded high-level trade talks in Geneva, which featured a "friendly tone" for the first time after a long period of tension, and they agreed to establish a new economic advisory mechanism. This means they are trying to create a long-term understanding instead of remaining in a trade war spiral.

This issue immediately reflected in market movements.

The US reduced tariffs on Chinese imports from 145% to 30%. China responded with a similar reduction from 125% to 10%. The result is that global markets began to stabilize, and people returned to focus on traditional exchanges again.

How does this affect the crypto market?

Here comes the crucial point: will this global stability cause liquidity to exit crypto and return to the exchanges? This could indeed happen... and if it does, it will have a clear and severe impact, especially on high-risk assets in crypto.

Let's take a step back and rearrange the events.

The crypto market is currently experiencing a strong recovery; the liquidity that entered was coming from financial institutions, individual investors, and hedge funds all fleeing from inflation and high interest rates.

But after the new agreement between the US and China and the beginning of signs of interest rate cuts in the US, investors are thinking:

Why take on the risks of crypto in the presence of economic stability and real opportunities? Will liquidity actually exit?