In a speech at the World Economic Forum in Davos, US President Donald Trump's declaration that he would not use military force to pursue the acquisition of Greenland sparked a broad market rally, lifting Bitcoin's price back above the $90,000 level.
Trump's lengthy address sought to allay fears of a military escalation, stating, "I won't use force... We want a piece of ice for world protection." He argued that a U.S. acquisition would enhance NATO security and pressed for "immediate negotiations" with Denmark. This reassurance came days after he threatened new tariffs on eight NATO members over Greenland-related security arrangements, which had heightened geopolitical risk.
Financial markets reacted positively to the de-escalation. The S&P 500 rose 0.6%, while the Dow Jones and Nasdaq each gained over 0.5%. Analysts from The Kobeissi Letter noted that Trump's tariff threats follow a 12-step process, and the current situation is on step seven, where "dip buyers step in and spark a relief rally." They cautioned this move could fade, but noted smart money typically begins buying between steps seven and eight.
Bitcoin mirrored this relief rally, reclaiming the $90,000 mark after dipping below $88,000 earlier in the day. Beyond Greenland, Trump also addressed monetary policy, criticizing Federal Reserve Chair Jerome Powell for being "too late" on interest rate decisions and urging for rate cuts. On cryptocurrency, Trump reiterated that the U.S. must remain the "digital asset capital of the world" and expressed hope that pending crypto legislation would be signed soon.
Despite the market's positive reaction, the European Union has reportedly halted work on a trade deal with the U.S. following Trump's comments, indicating underlying tensions persist.
