Bitcoin is once again dominating headlines, climbing rapidly toward the $100,000 milestone after gaining nearly 30% since April lows. This surge comes as growing fears about stagflation and economic instability weigh on the U.S. dollar, pushing investors toward alternative assets like Bitcoin.

Analysts from The Kobeissi Letter warn that the Federal Reserve is facing its toughest challenge yet. “The market is signaling stagflation is here,” they noted, referencing the dangerous combination of slowing growth and rising inflation. Recent data showed U.S. GDP shrinking 0.3% annualized in Q1, dragged down by a record surge in imports. Meanwhile, the PCE price index — the Fed’s preferred inflation gauge — remained unchanged in March, but stayed at its highest level since July 2024.

The Fed has been stuck in a difficult position. After cutting rates last September, the central bank paused its easing cycle, but mounting economic pressures may force its hand again. Markets are currently expecting the Fed to hold rates steady next week, but many traders are betting on a rate cut in June.

Such a move could fuel even more momentum for Bitcoin. “A shift toward looser monetary policy would inject fresh liquidity into risk assets like Bitcoin,” said Tracy Jin, COO of crypto exchange MEXC.

Bitcoin’s rise hasn’t been without bumps. Earlier this year, its price fell alongside equities as former President Trump’s trade war escalated. But since Trump’s “Liberation Day” announcement, Bitcoin has charted a different path, breaking past $90,000 and outperforming major indices like the Nasdaq.

“Bitcoin is proving its strength despite macroeconomic headwinds,” said David Hernandez, crypto investment expert at 21Shares. “We’re seeing a decoupling from traditional markets. With ongoing policy-driven volatility, Bitcoin could continue to outperform as investors seek safer havens.”

As the Fed’s next move approaches, all eyes are on Bitcoin’s trajectory. With the $100,000 mark in sight, Bitcoin’s resilience is positioning it as a standout performer in an increasingly uncertain market.

Key Takeaways:

Bitcoin up ~30% since April, nearing $100,000

U.S. GDP contracted 0.3% in Q1; inflation remains elevated

Markets expect Fed to hold rates next week; possible cuts in June

Bitcoin decoupling from stocks, outperforming Nasdaq amid economic uncertainty

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