Bitcoin (COIN:BTCUSD) climbed higher on Thursday, building on gains from the previous day amid positive developments in U.S. trade relations. However, traders remained cautious ahead of a series of important U.S. economic reports scheduled for later in the day.
The largest cryptocurrency appeared to break out of its recent $103,000 to $108,000 trading band on Wednesday, though it’s uncertain if this momentum will hold. By 09:56 ET (13:56 GMT), Bitcoin had risen 2.4% to reach $110,530. The broader crypto market also experienced gains as risk appetite improved, supported by strong overnight performance on Wall Street where the S&P 500 hit a new record high.
Trade Progress Boosts Bitcoin
Bitcoin’s upward move was fueled by optimism following the announcement of a trade deal between the U.S. and Vietnam — Washington’s third agreement ahead of the July 9 deadline. Markets also reacted positively to the U.S. easing export restrictions on chip technology to China after the two countries reached a framework trade agreement in June.
This progress raised hopes for additional trade deals before the deadline. While a deal with India is reportedly close, talks with Japan and South Korea have encountered obstacles. Former President Trump emphasized he does not intend to extend the July 9 deadline for imposing tariffs on key trade partners.
Focus on Tax Bill and Labor Market Data
Attention shifted to a contentious tax bill pending in Congress, which Trump said the House would vote on Thursday. However, reports indicated the bill was still under debate, with at least five Republicans opposing it, potentially delaying its passage.
Concerns mainly revolve around the bill’s impact on federal debt and economic stability, with critics warning it could heighten U.S. economic risks.
Key U.S. labor statistics, particularly June’s nonfarm payrolls, are also expected later Thursday. These data come amid speculation that the Federal Reserve may cut interest rates, with any notable slowdown in the labor market likely to increase easing expectations.
JPMorgan Downgrades Stablecoin Market Forecast
In a recent note, JPMorgan projected the stablecoin market will grow to approximately $500 billion by 2028, a figure far below some more optimistic estimates reaching into the trillions. The bank described those forecasts as “far too optimistic,” pointing to limited evidence that stablecoins are being widely adopted for everyday payments.
While stablecoins have expanded beyond their initial crypto trading use cases, gaining traction among fintechs and banks for faster settlements, JPMorgan noted that roughly 6% of stablecoin demand (around $15 billion) is currently linked to payments.
“The idea that stablecoins will replace traditional money for everyday use is still far from reality,” JPMorgan said.
With the market now around $250 billion, regulatory clarity from the GENIUS Act passage in the U.S. Senate could help, but the bank remains cautious due to fragmented rules, slow global uptake, and limited compelling uses beyond crypto.
Previous forecasts had been more bullish, with Standard Chartered anticipating a $2 trillion market by 2028 and Bernstein predicting growth up to $4 trillion over the next decade.
JPMorgan also dismissed parallels to China’s digital yuan or platforms like Alipay and WeChat Pay, stating, “Neither the rapid expansion of e-CNY nor the success of Alipay and WeChat Pay represent templates for stablecoin expansion in the future.”
Altcoins Bounce Back Alongside Bitcoin
The wider crypto market mirrored Bitcoin’s rebound, recovering from a weak June. Ethereum, the second-largest cryptocurrency, jumped over 7% to $2,632.81, while XRP rose 5.4% to $2.29.
Other notable moves included Solana’s 3.6% gain and Cardano’s impressive 7.9% rise after a sharp 17% drop in June. Among meme coins, Dogecoin surged about 8%, with $TRUMP up 4.4%.