Recently, global financial markets have been turbulent, with geopolitical and macroeconomic uncertainties intertwining, leading to drastic fluctuations in asset prices. The most striking development was Bitcoin's sudden surge today, breaking through the $87,000 mark, reaching a near month-high. At the same time, the dollar index weakened, and the trade tensions between China and the U.S. seem to be heating up again, sparking widespread speculation in the market about fund flows: does this mean that the dollar's weakness and potential changes in RMB policy are pushing funds towards Bitcoin and other cryptocurrencies as a safe haven?
Bitcoin surged over $3,000 in a short time this morning, reaching $87,700, with a daily increase of about 4%. The background for this rise is particularly noteworthy. First, the most direct macroeconomic catalyst is the sell-off of the dollar. The previous day, President Trump expressed intentions to replace Federal Reserve Chair Powell, and upon the news, the dollar index (DXY) promptly fell to 98.182.
In contrast to the weakening dollar, traditional safe-haven asset gold prices have climbed to a new high of $3,385 per ounce, with an increase of 28% year-to-date in 2025. However, the S&P 500 and Nasdaq futures have fallen by about 0.5%. The decoupling phenomenon of Bitcoin from risk assets (such as stocks) at this moment has drawn particular attention from market observers.
In response, financial writer Mel Mattison pointed out that he is seeing increasing evidence that Bitcoin is breaking its strong positive correlation with risk assets (especially QQQ, the ETF tracking the Nasdaq 100 index), and he revisited his argument from January: that this year will be the year Bitcoin breaks this correlation and begins to trade more in sync with gold, as the market seems to view it as an alternative financial system. Additionally, the macro analysis agency The Kobeissi Letter emphasized that the synchronized rise of these two hard assets is noteworthy, as if both are indicating that the dollar will weaken and more uncertainties are on the way.
Secondly, other contributing factors can be attributed to a 'non-tariff fraud' list announced by President Trump on Sunday, targeting economic aggression behaviors such as currency manipulation and export subsidies, which intensified market anxieties over trade policies. Although Trump’s ninety-day 'reciprocal tariffs' pause has over seventy days remaining, doubts about reaching a comprehensive agreement during this period are increasing.
Against the backdrop of Bitcoin's rise, the trade relationship between China and the U.S. remains a focal point for the market. The Chinese Ministry of Commerce issued a stern warning today to countries considering trade agreements with the U.S. that could harm China's interests. Previously, the Trump administration was prepared to use tariff exemptions as bait in exchange for other countries limiting trade with China.
In response, the Chinese Ministry of Commerce issued a strong statement: exchanging harm to others' interests for so-called exemptions is akin to seeking skin from a tiger, and warned that any country that reaches an agreement with the U.S. at the expense of China's interests will face resolute countermeasures from China, implying possible reciprocal tariffs. This indicates that China is attempting to build an international front against U.S. unilateralism.
Meanwhile, the RMB exchange rate policy has also remained a market focus. Against the backdrop of the current escalation of the China-U.S. trade war, the People's Bank of China once relaxed its control over the RMB, setting the USD/RMB midpoint at 7.2038, marking the first breach of the 7.20 level, which has been regarded by the market as the official 'soft red line' since Trump's election.
At the time, the market generally interpreted that allowing the RMB to depreciate moderately was one of China's options to enhance export competitiveness and alleviate tariff pressures, which might mean a shift in China's foreign exchange system towards 'managed devaluation.' However, significant devaluation also comes with risks, potentially exacerbating capital outflows, triggering bearish bets on the economy, and even angering the U.S., dimming the prospects for trade negotiations.
It is precisely this subtle change in the RMB exchange rate policy and potential uncertainties that have led the market to speculate about the flow of funds into Bitcoin. Analysts believe that if the RMB continues to face devaluation pressure, it may trigger capital outflows, potentially even repeating the scenario from ten years ago.
Looking back in history, on August 11, 2015, the People's Bank of China devalued the RMB by 1.9% in one go, marking the largest single-day drop in over twenty years at the time, causing global market tremors. Bitcoin rebounded strongly after a brief decline, soaring nearly 60% in the following four months, seen as a 'new channel' for capital seeking an exit.
Thus, the market boldly speculates that whenever the RMB weakens, there is a tendency for funds to flow into Bitcoin, and this time may be no exception. If China once again plays out the 'currency devaluation' script, the narrative of capital fleeing into Bitcoin will return to the market mainstream, as it has worked in 2013 and 2015, and may happen again in 2025.
Overall, the depreciation of the RMB, U.S. tariff policies, and market reactions to cryptocurrencies constitute a complex situation in the current financial environment. As the risk of capital outflows increases, cryptocurrencies such as Bitcoin may see a new round of price increases. Investors should cautiously assess market dynamics at this time and seek suitable investment opportunities.
