Bitcoin surged past $109,000 backed by institutional inflows, macroeconomic optimism, and renewed trade deals, yet traders remain cautious. Stay updated with the latest insights via the Bitrue blog.

On July 3rd, Bitcoin (BTC) price soared by 2.05%, adding more than $2,900 to its value as it rallied from $106,300 to a peak of $109,862. The world’s largest cryptocurrency briefly pared gains to settle at $109,600, just under 3% shy of its all-time high of $111,970.

A surge in trading volume to $52.6 billion indicated that the move wasn’t speculative, it was driven by serious capital commitment, with Bitcoin accounting for nearly 45% of total crypto market activity.

The rally reflects a rare convergence of macroeconomic shifts, improving liquidity, and bold investor behavior. Standard Chartered reaffirmed its bullish forecast, expecting Bitcoin to reach $135,000 by Q3 and $200,000 by the end of the year.

The bank attributes the momentum to a “new flow regime,” where spot ETFs, sovereign accumulation, and corporate treasury investments are displacing the post-halving slowdown narrative.

Institutional Demand Fuels Uptrend

In Q2 alone, institutional players added approximately 245,000 BTC to their holdings, with many new buyers emerging outside of known entities like MicroStrategy.

This trend is projected to accelerate, especially as passive ETF allocations gain traction and more public companies adopt Bitcoin as a treasury reserve asset.

This week’s successful launch of the REX-Osprey Solana + Staking ETF, which registered $20 million in day-one volume, further reinforced market appetite for crypto ETFs.

Bloomberg analyst Eric Balchunas labeled it a “top 1% debut,” and its success signaled growing confidence in altcoin-based products while bolstering Bitcoin’s standing as the sector’s foundation.

Macroeconomic Boost: Trade Deals and Policy Shifts

Bitcoin’s momentum also coincides with fresh macro tailwinds. U.S. President Donald Trump announced a trade agreement with Vietnam, Washington’s third such deal in recent weeks.

The new terms include a 20% tariff on Vietnamese exports and a 40% tariff on rerouted goods, but grant tariff-free access to U.S. exports.

This development, seen as part of Trump’s post-election economic pivot, lifted equities and risk assets across the board. The Nasdaq climbed 0.8%, and Bitcoin surged past the $109,000 mark.

Progress on U.S. trade fronts with India and China, as well as eased restrictions on chip exports, contributed to investor optimism. However, talks with Japan and South Korea have reportedly stalled.

A controversial tax bill is also under scrutiny in Congress, with some Republicans threatening to block its passage over fiscal concerns.

Amid all this, the market is closely watching U.S. labor data. A weaker-than-expected reading could prompt interest rate cuts from the Federal Reserve, adding further support for risk-on assets like Bitcoin.

Crypto Market Responds in Kind

The bullish sentiment rippled through the broader crypto market.

1. Ethereum (ETH) rose 6.1% to $2,592.85

2. XRP gained 3.7%

3. Cardano (ADA) rebounded 7.8% after a sharp June decline

4. Solana (SOL) added 4.3%

5. Meme coins also saw action, with Dogecoin (DOGE) up 8.1% and $TRUMP climbing 4.4%

These gains suggest renewed investor confidence, particularly after a sluggish June.

Skepticism Lingers Despite Price Strength

Despite the bullish price action, derivatives data reveals a more cautious undertone. The BTC one-month futures premium remains below the 5% neutral mark, suggesting traders are not fully convinced of a sustained breakout.

This cautious sentiment began mid-June and continues even as Bitcoin retests levels near $110,000.

Additionally, the rally may have been partially driven by macro liquidity trends. Eurozone M2 money supply rose 2.7% year-over-year in April, echoing similar expansionary policies in the U.S.

Meanwhile, private payroll data from ADP revealed a drop of 33,000 jobs in June, adding to fears of an economic slowdown.

Options markets remain neutral as well. The 25% delta skew, which indicates risk perception in BTC options, stood flat at 0%, reflecting balanced sentiment on both upward and downward price moves.

While this is more optimistic than the bearish tone observed in late June, it still reflects market hesitancy.

China Market Signals Weak Confidence

Despite global bullishness, crypto sentiment in China tells a different story. A 1% discount on Tether (USDT) against the official CNY rate, its steepest since mid-May, suggests Chinese investors are exiting the market rather than buying in.

This divergence could indicate regional skepticism about the sustainability of Bitcoin’s rally.

Adding to the concern, spot Bitcoin ETFs saw $342 million in net outflows on Tuesday, further reinforcing market caution.