Bitcoin$BTC Nears $110K Amid U.S.–China Trade Optimism

Bitcoin $BTC surged past $105,000 on Monday, May 12, 2025, buoyed by renewed optimism surrounding U.S.-China trade negotiations and growing investor confidence in the cryptocurrency market.

Key Drivers Behind the Bitcoin Surge

1. U.S.–China Trade Agreement

The United States and China agreed to significantly de-escalate their trade war by cutting reciprocal tariffs for 90 days. Under the new agreement, U.S. tariffs on Chinese goods are reduced from 145% to 30%, and China’s tariffs on U.S. goods are lowered from 125% to 10%. This surprising announcement followed productive trade talks in Geneva, with both countries affirming a desire to avoid economic decoupling and pursue more balanced trade.

2. Anticipation of Favorable CPI Data

Investors are also eyeing the upcoming U.S. Consumer Price Index (CPI) report, scheduled for release on Tuesday. Analysts expect the April CPI to show a year-over-year decrease to 2.3%, down from 2.4% in March. A softer inflation reading could strengthen bets on Federal Reserve rate cuts, providing further support for Bitcoin's price.

3. Institutional Investment and ETF Inflows

Bitcoin spot ETFs, led by BlackRock’s IBIT, continue to see strong inflows. BlackRock’s IBIT ETF has recorded 20 consecutive days of net inflows, surpassing $5 billion in assets under management. This steady institutional interest has been a major catalyst in Bitcoin’s near V-shaped recovery from $75,000 to over $104,000 in just over a month.

Market Outlook

While Bitcoin's recent rally is encouraging, analysts caution that resistance is mounting near its all-time high of $109,000. Profit-taking and geopolitical uncertainties may hinder further significant upward price movements.

*Disclaimer: This article is for informational purposes only and does not constitute financial advice.

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