Bitcoin’s price has stabilized around $88,000 in recent days, despite the U.S. Dollar Index (DXY) reaching its lowest level in twelve months and gold hitting new highs. Financial experts note that Bitcoin has behaved more like a volatile beta asset rather than a safe haven, indicating that investors do not currently view it as a hedge against the dollar. Traditionally, gold and other precious metals are preferred by investors during currency weakness as they provide protection against inflation and currency depreciation. Bitcoin, often dubbed “digital gold,” was once considered a stable asset during financial uncertainty. However, recent market trends have challenged this notion, as Bitcoin’s price fluctuations prevent it from serving as a stable hedge like traditional currencies or gold. The prices of Bitcoin and other cryptocurrencies are generally influenced by global financial conditions, central bank policies, and investment trends. Bitcoin’s steady price amid the dollar’s weakness suggests that investors in the crypto market are adopting a higher risk tolerance, using it primarily for potential gains rather than risk mitigation. Should global financial markets experience further volatility or central banks alter their policies in the coming weeks, Bitcoin’s price could be affected. Investors are advised to consider the inherent volatility of cryptocurrencies when making investment decisions.
Source: decrypt
