Bitcoin ETFs Rebound as Trump Suspends Tariffs on Mexico and Canada for a Month
Bitcoin ETFs rebound after President Donald Trump agreed to pause tariffs on Mexico and Canada for a month, leading to renewed investor confidence. Spot Bitcoin exchange-traded funds (ETFs) in the United States have returned to net inflows, reversing the previous day’s outflows and signaling a shift in market sentiment.
According to Farside Investors, the 12 spot Bitcoin ETFs recorded a net inflow of $340.7 million on Feb. 4, marking a sharp turnaround from the $234.4 million in net redemptions seen the previous day. BlackRock’s IBIT led the inflows with $249 million entering the fund after a day of inactivity. Since their launch, these Bitcoin ETFs have collectively accumulated around $40.7 billion in inflows.
ARK and 21Shares’ ARKB saw inflows of $56.1 million, while Grayscale’s GBTC and Bitwise’s BITB recorded inflows of $19.5 million and $16.1 million, respectively. The remaining seven ETFs reported no inflows or outflows, indicating a cautious stance among some investors.
The Bitcoin ETFs rebound was largely driven by Trump’s decision to temporarily halt the imposition of the 25% tariffs on Canada and Mexico, following negotiations with their leaders. Additionally, Trump signed an executive order establishing a sovereign wealth fund, fueling speculation within the crypto community that the U.S. government might consider Bitcoin as part of its holdings.
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Following the news, Bitcoin briefly reclaimed the $100,000 key level on Feb. 4, alongside notable gains in other cryptocurrencies such as Ethereum, Solana, XRP, and Dogecoin. This signaled a potential bullish resurgence, despite the recent market downturn that had wiped out over $500 billion in crypto value on Feb.
The broader cryptocurrency market faced significant volatility due to concerns over a global trade war following Trump’s tariff announcement on Canada, Mexico, and China. The uncertainty led to over $2 billion in liquidations in the crypto derivatives market, exacerbating short-term bearish sentiment.
Matt Mena, a crypto research strategist at 21Shares, commented on the situation, stating that while the tariffs introduced short-term volatility, they “may contribute to a longer-term shift that ultimately benefits Bitcoin.” He explained that if the U.S. aims to weaken the overvaluation of the dollar while keeping borrowing costs low, it could put pressure on the Federal Reserve to cut interest rates, fostering a more favorable monetary environment for Bitcoin.
Mena also pointed out that Bitcoin’s history suggests that sharp corrections are often followed by strong recoveries. February has historically been a positive month for Bitcoin, with an average return of 15.66% over the last 14 years, according to data from CoinGlass.
