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Cryptocurrency markets saw a short-term boost following news that the Biden administration would temporarily pause additional tariffs on select imports, sparking optimism across risk-on assets. However, analysts at CryptoQuant warn that on-chain metrics and market fundamentals remain weak, signaling that a sustained rally may not be imminent.
Market Reaction to Tariff News
Major cryptocurrencies, including Bitcoin (BTC) and Ethereum (ETH), posted gains in the 3–6% range after the White House announced the tariff reprieve, citing ongoing trade negotiations. Solana (SOL) and other altcoins outpaced Bitcoin briefly, with traders interpreting the move as a signal of easing macroeconomic pressure.
The broader rally reflected improved risk sentiment, similar to reactions seen in equities and commodities. However, analysts caution that the bounce may be more of a relief rally than a true reversal in trend.
CryptoQuant: Rally Lacks Fundamental Support
According to a new report from on-chain analytics firm CryptoQuant, core indicators of market strength have not shown meaningful improvement.
“Despite the price uptick, we are not seeing corresponding growth in active addresses, exchange inflows, or long-term holder accumulation,” said Ki Young Ju, CEO of CryptoQuant.
The firm highlighted several red flags:
- Exchange reserves remain flat, suggesting a lack of new investor inflows.
- Stablecoin supply growth, a key signal of market buying power, has slowed.
- Funding rates and derivatives activity point to cautious sentiment among leveraged traders.
CryptoQuant analysts emphasized that macro-policy headlines can drive temporary price moves, but sustained bull markets typically require stronger structural and on-chain momentum.
Market Still in Cautious Mode
While the pause in tariff implementation may relieve short-term pressure on risk assets, crypto markets are still contending with a range of headwinds: regulatory uncertainty, declining liquidity, and persistent macroeconomic volatility.
“We’re seeing enthusiasm at the headline level, but not the deeper conviction needed to kick off a full bull cycle,” said CryptoQuant’s research team.
Traders and analysts alike will be watching closely to see whether the current rally finds support or fades as quickly as it began. Attention now turns to upcoming macroeconomic data and any follow-up policy signals from Washington or global central banks.
The US tariff pause provided a short-term boost for crypto prices, but underlying metrics tracked by CryptoQuant suggest the market remains fragile. Without stronger fundamentals, the recent rally may be short-lived.
