It is worth noting that the Fed has not yet started a rate cut cycle, and the dollar has already dropped this much; once the dollar cuts rates, it will accelerate its depreciation, which is truly terrifying. Therefore, the world is looking for safe havens for funds, with the Eurozone being one and gold another. Additionally, for the first time in many years, BTC and the dollar have diverged, and I believe the fundamental reason is that BTC is gradually detaching from the narrative of risk assets.
One possible explanation for the recent surge in BTC is: a stratification of risk preference—institutional funds tend to hedge against geopolitical risks with gold; while retail investors bet on liquidity easing through Bitcoin.
"The breakdown of the correct correlation between the two indicates that as gold prices approach absurd levels, the next safe haven choice away from the dollar collapse will be Bitcoin—after all, it's just a matter of time before all other central banks heavily print money to suppress their currencies."
The current trend of Bitcoin may prove the necessity of cryptocurrency. Retail investors, especially those who cannot truly buy gold, need a safe haven outside of gold. And perhaps Bitcoin will indeed become 'digital gold'?
