- The rally coincided with U.S. Treasury Secretary Scott Bessent’s comments on de-escalation of U.S.-China trade tensions and President Trump indicating no intention to fire Fed Chair Jerome Powell.
- Open interest in cryptocurrency perpetual futures markets increased substantially alongside price growth, with BTC’s open interest rising 10% to $17.83 billion and ETH’s jumping 16% to $6.60 billion.
Bitcoin and ether surged significantly on Tuesday as investor confidence strengthened amid a softening stance from the Trump administration on trade tariffs and Federal Reserve relations. BTC rose 6.79% to nearly $94,000, its best single-day percentage increase since April 9, while ETH jumped 11% to $1,175, marking its strongest performance since April 2, according to CoinDesk data.
The upward momentum coincided with U.S. Treasury Secretary Scott Bessent’s comments on reducing U.S.-China trade tensions, followed by President Trump stating that tariffs on Chinese goods would drop substantially from the current 245%. Trump also confirmed he does not plan to fire Federal Reserve Chair Jerome Powell.
The price surge was accompanied by significant increases in perpetual futures trading activity across major exchanges. Data from Velo shows the cumulative notional open interest for BTC perpetual futures—the dollar value of active bets—rose by 10% to $17.83 billion, the largest single-day increase since March 2. Similarly, ETH’s notional open interest jumped nearly 16% to $6.60 billion, its biggest daily increase since November 27.
“Bitcoin’s Open Interest surged faster than its Price, with most positions originating from Binance,” noted Joao Wedson, CEO of Alphractal Research, on X. “The issue is that a large portion consists of Longs, so increased volatility is expected in the coming hours.”
Funding Rates Bullish
The bullish sentiment is further reflected in the moderately positive annualized perpetual funding rates, which currently range between 5% to 10% for both BTC and ETH. These funding rates, charged every eight hours, represent payments exchanged between traders holding long and short positions in perpetual futures contracts.
Positive funding rates indicate traders are willing to pay fees to hold long positions, signaling bullish sentiment in the market. However, the current rates aren’t excessively high, which would typically suggest overcrowding or speculative excess.
Market analysts note that the rally was likely assisted by a short squeeze—the unwinding of short perpetual futures positions. Funding rates were negative approximately 24 hours before the price surge, indicating a bias toward short positions that quickly reversed.
The simultaneous increase in open interest alongside climbing prices is traditionally viewed as confirmation of bullish momentum, suggesting both BTC and ETH may continue their upward trajectory in the near term.
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