U.S. Dollar Fed Warning Braces Bitcoin For A BlackRock ‘Megaforce’ Price Shock
Bitcoin has bounced back this week alongside tech stocks after a leak revealed serious establishment fears of crypto “contagion."
The bitcoin price has surged toward $100,000 per bitcoin as one closely-watched crypto investor calls the market bottom, telling people to “buy everything” ahead of a Federal Reserve flip.
Now, as Binance’s chief executive confirms wild speculation that could blow up the bitcoin price, "major" U.S. dollar warnings are priming bitcoin for a “geopolitical fragmentation megaforce" shock.
“The preconditions are now in place for the beginning of a major dollar downtrend,” Deutsche Bank analysts George Saravelos and Tim Baker wrote seen by MarketWatch in a note, pointing to a huge shift in U.S. trade policy and a global reassessment of U.S. geopolitical leadership and predicting the end of a “higher for longer” dollar.
The U.S. dollar has been supported in recent months by Fed chair Jerome Powell’s relatively hawkish approach to interest rates in the face of inflation fears, though U.S. president Donald Trump has piled pressure on Powell to cut rates.
“Given the historical developments of the last few months our EUR/USD forecasts now anticipate the dollar entering a long-winded downcycle,” the Deutsche Bank analysts wrote, adding that, "in a world of extreme uncertainty and rapidly shifting policy norms, the risk of market dislocations and regime breaks remains high."
The warning echos the concerns of Goldman Sachs’ head of FX who told Bloomberg this week that the U.S. dollar’s weakness is “here to stay,” as the world adjusts to the new tariff-based international trade order established by Trump.
