Bitcoin‘s price has been on a rollercoaster ride, shedding 5% over the weekend, only to settle near $82,000. This latest decline places the cryptocurrency roughly 25% below its all-time high of $109,900. Analysts attribute the downturn to ongoing trade tensions and the fears of a looming recession.
Meanwhile, a weakening US Dollar Index (DXY) has fallen from 110 to 103 since mid-January, coinciding with Trump’s second term in office. This could be a potential bullish catalyst for the Bitcoin price. In a series of posts on X, Jamie Coutts, Chief Crypto Analyst at Realvision, offers a look at the current market environment, highlighting two key metrics that could shape central bank policy—and, by extension, Bitcoin’s trajectory.
“Bitcoin is like playing a game of Chicken with central banks,” Coutts writes. He explained that while the dollar’s recent decline supports a bullish framework for Bitcoin, rising Treasury bond volatility and widening corporate bond spreads are causing concern.
Despite these cautionary flags, Coutts remains optimistic about Bitcoin’s medium-term prospects, primarily due to the dollar’s “rapid decline.” He noted that the dollar’s drop in March—one of the most significant monthly dips in 12 years—historically has coincided with bullish inflection points in Bitcoin’s price.
Coutts also mentioned that Bitcoin appears to be “filling a big gap” and reiterated his view that a slide below the high-$70,000 range would signal a fundamental market shift. Meanwhile, he sees central bankers edging closer to possible intervention as Treasury volatility and credit spreads climb:
- Nation-State Adoption: “A global nation-state race is underway,” Coutts wrote, describing a scenario in which countries either include Bitcoin in their strategic reserves or ramp up mining efforts.
- Corporate Accumulation: He points to the possibility of companies—particularly Strategy (MSTR)—adding 100,00 to 200,00 BTC this year.
- ETF Positions: Exchange-traded funds may “double their positions,” further driving institutional inflows.
- Liquidity Dynamics: In Coutts’s words, “The Spice Must Flow.”
“Think of Bitcoin as a high-stakes game of chicken with the central planners. With their options dwindling—and assuming HODLers remain unleveraged—the odds are increasingly in the Bitcoin owner’s favor.”
For now, the world’s largest cryptocurrency appears to be treading a line between macroeconomic headwinds—highlighted by a volatile bond market—and the tailwinds of a weakening dollar. Whether Bitcoin continues to retreat or resumes its long-term ascent will likely depend on how global policymakers respond to mounting bond market pressures—and whether holders are prepared to keep playing “chicken” with the central planners.
At press time, BTC traded at $82,091.
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2025-03-10 10:55