Bitcoin Price Breaks Past $100,000 as China Eases Rates, Setting Off a Ripple of Excitement Through the Crypto World

Bitcoin's price rocketed past $100,000 on May 9, 2025, sending a ripple of excitement through the crypto world.

Bitcoin price rose past the $100,000 mark on May 9, 2025, sparking excitement in the crypto sphere.

Here's a breakdown of the rally, considering macroeconomic backdrop, market internals, and varying perspectives.

Bitcoin Price Surges Past $100K With Flurry of Macro Activity

Traders saw BTC/USD quickly climbing from $97,200 in early Asian trading to a peak of $99,050 before settling around $103,900.

The move came amid a flurry of macroeconomic developments that traders were watching closely.

China’s central bank trimmed its one-year lending rate by 15 basis points and cut the reserve requirement ratio by half a percentage point, together freeing an estimated $100 billion of liquidity into the market.

The rate cut was the first easing since December 2024, coming as Beijing seeks to shore up growth and support its equity and property markets.

Bankers and economists polled by Reuters had broadly expected a cut to the yuan interest rate, anticipating slower-than-expected economic recovery in the second quarter of 2024.

"We expect further monetary policy easing to be announced in the coming months, in response to rising economic and financial risks," Yu Zeng, economist at Essence Securities, told Reuters.

These measures were announced just hours before Bitcoin broke $99,000.

This was in contrast to the U.S. Federal Reserve, which had paused its tightening cycle. In its May 1 statement, the Fed kept the federal funds target at 5.25 percent. Officials cited mixed growth signals and cooling inflation.

"The rapidly changing economic landscape will likely factor into upcoming Fed actions, presenting a unique challenge for navigating the delicate balance between stability and recovery," said Ben Casper, U.S. macro strategist at Jpmorgan Chase, in a note to clients.

The pause contrasted with Beijing’s easing, highlighting divergent policy paths.

Behind the scenes, U.S.–China relations also warmed with diplomats holding discreet talks on May 2 to start formal trade negotiations on Friday, May 16 (U.S. Trade Representative’s Office, May 2, 2025).

Traders saw this as a move that could reduce friction in goods and capital flows.

Market Internals Show Slip In U.S. Bitcoin Demand

Not every indicator was bullish on May 9.

Coinbase Pro reported a slip in Bitcoin’s price premium versus global benchmarks into negative territory. U.S. traders were seen paying a slight discount, marking the first negative premium in six weeks.

This signaled that the bulk of recent buying was seen in offshore markets, impacting market internals.

Meanwhile, CryptoQuant reported record-high short interest among institutional funds. Funds had reportedly increased bearish positions as prices climbed. This setup bore similarities to prior short squeezes, where forced buy-ins might accelerate rallies.

Those covering shorts quickly could push Bitcoin past $100,000.

FOMO Among Bulls Vs Caution From Bears

Thinking from the bulls was that China’s liquidity surge and the Fed’s hold on rates offered support. They saw the thaw in U.S.–China ties as a further catalyst, considering that cross-border flows may increase with formal trade talks slated for May 16.

They argued that record shorts on major funds set the stage for a short squeeze.

Thinking from the bears was to urge caution as the negative Coinbase Pro premium was a warning sign. They argued that U.S. demand may lag behind overseas buying.

This was indicated by the varying price levels on Coinbase Pro and global spot markets, impacting how institutions were positioning for further moves.

The bears were worried that heavy short positions signaled deeper skepticism, especially with those covering shorts quickly capable of pushing Bitcoin past $100,000.

Those shorts could reinforce selling if policy easing disappoints or trade talks stall. They also flagged lower Asian volume during Golden Week from May 10 to May 16.

Thin liquidity could exaggerate price swings in either direction, rendering market internals crucial for gauging buying and selling pressure.

Bitcoin’s climb to just over $104,000 captured a moment of policy tug-of-war with Beijing’s easing and Washington’s steady rates offering mixed signals.

Improving U.S.–China ties hinted at smoother trade, but market internals from negative U.S. premiums to peak shorts painted a complex picture.

Whether FOMO will push Bitcoin towards a new all-time high (ATH) remains open as traders watch for forced short-covering and volume shifts with Asia reopening after Golden Week.

They will also keep an eye on updates from Beijing, the Fed, and USTR announcements.

At the time of writing, Bitcoin’s price is $103,7