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Good News for BTC? US Dollar Weakness Accelerates as Experts Predict Bitcoin Parabolic Move
The strength of the US dollar is weakening rapidly, which could potentially be a positive sign for Bitcoin (BTC) investors. According to Ted Labs co-founder Niels, the dollar index has “entered free-fall mode.” The DXY index measures the greenback’s performance against a basket of other currencies and has declined 11% so far this year.
This is not only its worst performance in 40 years but also echoes previous events where such a decline correlated with significant gains for Bitcoin. In 2017, when the dollar index dropped by nearly 15%, Bitcoin went parabolic. Similarly, during the period of March 2020 to mid-2021, DXY fell by almost 13% as Bitcoin surged to new highs.
The current downward trend in the dollar index has sparked concerns about a potential devaluation of the currency. This could potentially create a fertile ground for alternative stores of value like Bitcoin to thrive. Experts are now predicting that this weakness in the dollar could lead to a parabolic move in Bitcoin’s price, making it an attractive option for investors seeking inflation protection and a hedge against a weakening greenback.
In fact, some experts believe that the US government is actively planning to devalue the dollar further by increasing the debt limit by $5 trillion. This would likely have significant implications for the global financial system. As such, it’s not surprising that Bitcoin pioneer Anthony Pompliano has warned investors about the dangers of saving in dollars or bonds due to their potential devaluation.
The correlation between a weakening US dollar and an uptrend in Bitcoin is not new news, as we’ve seen this pattern play out before. The recent decline in DXY could be a precursor to a significant bull market surge later this year.
Source: cryptopotato.com
