Bitcoin briefly tops $109K as trade war tensions ease

Bitcoin initially rose to $109,857 in value during trading Wednesday morning as trade war tensions eased

Bitcoin price rose to $109,857 during morning trading Wednesday as trade war tensions eased between the United States and China and a recent U.S. credit downgrade.

The world's leading cryptocurrency was later trading at $106,678.74 by 3:35 p.m. EST after morning trading saw the digital currency reach a new all-time high.

The price record represents a 3% increase in Bitcoin's value during morning trading, but much of that increase receded by about an equal amount by the time afternoon trading began.

The cryptocurrency has seen a 26% rise in value over the past 30 days and reached its current record value nine days after the Trump administration announced a 90-day trade agreement with China.

On May 12, the administration said it was delaying a threatened increase in tariffs on $200 billion worth of Chinese goods after the two nations reached an agreement to continue trade negotiations.

The announcement came after months of tit-for-tat tariff increases that began when Trump imposed a levy on steel and aluminum imports earlier in 2018.

The administration also imposed tariffs on $50 billion in Chinese goods, to which Beijing retaliated with tariffs of equal value.

After the administration threatened to increase tariffs on $200 billion in goods, China agreed to purchase "a vast amount" of agricultural, energy, and other products from the U.S., according to a statement from the Treasury Department.

"The agreement also includes provisions for the protection of intellectual property, services, and the opening of the Chinese market to U.S. financial services companies," the statement said.

Earlier this year, the administration threatened to move the U.S. embassy in Israel to Jerusalem if Israel did not agree to open its market to U.S. financial services companies.

The administration also said it was working with China to resolve the trade tensions during a recent meeting of the International Monetary Fund and World Bank in the spring.

"The U.S. administration is committed to a 'win-win' outcome that benefits both countries and the global economy," the Treasury Department said in its statement.

At the beginning of April, Bitcoin was trading for $74,434. At the time, the cryptocurrency had seen a gain of about $15,000 in just five days after Trump announced his reciprocal tariffs trade policy on April 2.

Recently, the war in Ukraine and the potential for a cease-fire with Russia helped Bitcoin to being its 26% climb in May, Jag Kooner, derivatives leader at Bitfinex exchange, told Cointelegraph.

"The Russia-Ukraine cease-fire talks have defused one of the primary geopolitical volatility engines of the past two years," Kooner said.

"We're seeing capital rotate into [Bitcoin] and high-beta tech as the need for geopolitical hedging fades, but liquidity remains abundant," Kooner added.

While Bitcoin achieved an all-time high early Wednesday, Dogecoin saw a larger percentage gain during the day's trading.

Dogecoin rose 6% in value over the past 24 hours, but that value is just 23 cents for the meme coin, according to decrypt.

The increased interest and investment in cryptocurrency follow GOP lawmakers' recent introduction of legislation to create a national strategic Bitcoin reserve to improve the nation's finances.