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Bitcoin Surpasses $100,000: Analyzing the Factors Behind the Surge

Bitcoin Surpasses $100,000: Analyzing the Factors Behind the Surge
BTC over $100k

Summary:
Bitcoin’s rally to over $100,000 on May 8, 2025 was fueled by a confluence of factors: optimism around a newly announced U.S.–U.K. trade agreement, surging institutional inflows (notably into spot Bitcoin ETFs), and a broad uptick in market sentiment toward risk assets. While the U.K. agreed to lower tariffs to 1.8% and the U.S. maintained a 10% levy—calming fears of renewed trade wars—fund managers poured over $5 billion into Bitcoin funds in recent weeks. Technical indicators and equity correlations also supported the move, even as some analysts warn of potential retracements. This rally underscores Bitcoin’s evolving role not just as a speculative play, but increasingly as a mainstream financial instrument and inflation hedge.

Introduction

The crypto world buzzed on May 8, 2025 when Bitcoin surged above $100,000, hitting intraday highs north of $101,500 for the first time since February Reuters. This landmark comes amid renewed hopes for global trade stability, record ETF flows, and a broader “risk-on” mood in markets. In this article, we’ll explore three key drivers behind the surge—and what they mean for Bitcoin’s next moves. You’ll also find quick links to our Glossary for crypto definitions, our Blockchain Foundations series for deeper technical context, and the latest Market Insights analyses.

1. U.S.–U.K. Trade Agreement: A Catalyst for Risk Assets

  • On May 8, President Trump and Prime Minister Starmer announced a trade deal keeping U.S. tariffs at 10% while the U.K. cut theirs to 1.8%, easing fears of tit-for-tat levies that had rattled markets in April Reuters.
  • This tariff truce restored confidence in cross-border commerce and prompted broad rallies in equities—Dow Jones gained 1.3% the same day—which in turn lifted correlated assets like Bitcoin MarketWatch.
  • FXStreet noted the deal spurred a $3.2 trillion crypto-market cap rally, with meme coins and top-100 tokens surging alongside BTC FXStreet.

2. Institutional Inflows: ETFs and Balance-Sheet Allocations

  • Spot Bitcoin ETFs attracted $5.3 billion of fresh capital over three weeks, as reported by Business Insider, marking the largest inflows since ETFs went live earlier in 2025 Business Insider.
  • Major asset managers like Standard Chartered now forecast Bitcoin at $120,000 by Q2, underpinned by these ETF flows and strategic allocations by funds such as Strategy’s planned $84 billion in BTC Business Insider.
  • On-chain data show whales accumulating, while CME volumes hit multi-year highs in derivatives and spot trading, suggesting institutional maturity in crypto markets Reuters.

3. Market Sentiment and Technical Momentum

  • The Crypto & Fear & Greed Index climbed into “Greed” territory (score ~65), reflecting a shift from April’s risk aversion after tariff threats Cointelegraph.
  • Technical analysis on 15-minute charts showed MACD histograms turning positive and RSI approaching 70—signs of sustained bullish momentum toward $106,500 resistance FXStreet.
  • State-level moves—Arizona, New Hampshire, and Oregon passing Bitcoin reserve laws—added to the regulatory tailwinds, helping legitimize Bitcoin in the eyes of institutions and retail alike CoinGape.

Conclusion

Bitcoin’s breach of $100,000 was no accident of timing. It reflected geopolitical easing, record institutional demand, and renewed risk appetite. Yet, key resistance lies between $101,500 and $109,000, and a drop below $93,780 could signal a pullback toward $80,000 MarketWatch.

Practical Takeaways:

  • Watch for tariff or trade news; any re-escalation could rapidly reverse gains.
  • Monitor ETF flows—continued inflows bolster higher targets.
  • Keep an eye on on-chain whale activity and derivatives open interest for signs of exhaustion.

Questions to Ponder:

  • Will Bitcoin sustain its role as a digital store of value amid central bank rate cuts?
  • Can geopolitical détente propel crypto into mainstream portfolios long term?
  • What’s the next catalyst—DeFi adoption, Web3 integration, or new ETF approvals?

Dive deeper into these topics in our Market Insights section and strengthen your foundations in our Blockchain Foundations series.

Citations

  1. Bitcoin tops $100,000 on trade deal optimism Reuters
  2. BTC ETF inflows and price forecast Business Insider
  3. Correlated stock market rally MarketWatch
  4. FXStreet on crypto-market cap surge FXStreet
  5. Regulatory clarity from state Bitcoin laws CoinGape
  6. Reuters experts on institutional adoption Reuters
  7. Cointelegraph on trade-deal speculation Cointelegraph
  8. Yahoo Finance on trade-deal pump Yahoo Finance
  9. Bloomberg on easing trade fears Bloomberg
  10. Economic Times on institutional fueling m.economictimes.com

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