Bitcoin Surges 7% to Over $63K as Traders Anticipate China’s Fiscal Policy Update

Bitcoin (BTC) rebounded sharply on Friday, bouncing back 7% to surpass $63,000 as traders turned their focus to an impending fiscal policy update from China. This recovery followed a dip below $59,000 earlier in the week, fueled by slightly higher inflation readings in the U.S. market. Investors quickly dismissed inflation concerns, redirecting their attention toward potential financial stimulus from China.

As the leading cryptocurrency by market capitalization, Bitcoin outperformed the broader market, gaining 5.5% in the last 24 hours. Among altcoins, Solana’s SOL, Avalanche’s AVAX, and Render’s RNDR led the charge with impressive gains of 6% to 8%. 

The crypto rally coincided with gains in traditional equities, as both the Dow Jones Industrial Average and S&P 500 closed the week at record highs. Meanwhile, the U.S. dollar index stabilized below 103 after a significant rise throughout the week, as traders adjusted their expectations for further Federal Reserve interest rate cuts in light of solid jobs reports and the latest inflation data.

Crypto-related stocks also mirrored this positive sentiment. Bitcoin mining companies, including Marathon Digital Holdings (MARA), Riot Platforms (RIOT), and Bitdeer (BTDR), saw their shares soar between 5% and 10%. Additionally, major U.S. crypto exchange Coinbase (COIN) concluded the day with a 7% increase.

Notably, MicroStrategy (MSTR), the largest corporate holder of Bitcoin with nearly $16 billion in assets, surged 16% to its highest price since March 2000. The premium of its share price relative to its Bitcoin holdings also widened to levels not seen since 2021.

China’s Fiscal Policy Update May Impact Crypto Markets

According to a Friday report from Coinbase analysts David Duong and David Han, the focus of macroeconomic factors influencing crypto prices is shifting away from monetary policy to potential outcomes of the upcoming U.S. elections. The imminent fiscal policy update from China’s finance minister, scheduled for early Saturday UTC, is expected to be a key catalyst for crypto volatility.

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Investors are anticipating additional financial stimulus to support the struggling Chinese economy, which could have ripple effects in the digital asset market. The Coinbase report indicated that as most markets will be closed during this briefing, traders might turn to crypto markets to express their proxy views on the anticipated fiscal announcements.

Markus Thielen, founder of 10x Research, emphasized that recent U.S. economic data indicates a resilient economy and job market, alleviating previous recession fears. “This sets the stage for risk assets to perform well into year-end, and it may take little to drive crypto prices higher,” Thielen stated. “A significant move is likely on the horizon, and diligent traders will be well-positioned to capture it.”