Bitcoin Nears $100K As U.S. Economy Wobbles — Is This the Fed’s Worst-Case Scenario Unfolding?
Bitcoin is once again stealing the spotlight, surging toward the $100,000 mark and shaking up the financial landscape. This week alone, the world’s leading cryptocurrency has rallied nearly 30% from its April lows, driven by mounting concerns around the U.S. economy and the future of the dollar.
According to market analysts, the Federal Reserve may be staring down its biggest fear: stagflation — the dreaded mix of stagnating growth and rising inflation.
Fresh data from the U.S. Commerce Department revealed a surprising contraction in GDP during Q1, shrinking at an annualized rate of 0.3%. The report also highlighted a record jump in imports, adding further weight to the economic slowdown narrative. At the same time, the Fed’s favored inflation gauge, the PCE price index, remained flat in March, after a 0.4% rise in February. This puts the index at its highest since July 2024 — just before the Fed began its short-lived pivot toward rate cuts.
“The market’s message is loud and clear: inflation is back, and growth is slowing. It’s a no-win situation for the Fed,” analysts from The Kobeissi Letter posted on X.
Amid this uncertainty, Bitcoin’s rise is seen by many as a strategic move by investors seeking shelter from traditional market volatility. Traders are now betting on the Fed cutting rates in June — a move that typically injects more liquidity into risk assets like Bitcoin.
“Historically, monetary easing fuels rallies in the crypto space,” said Tracy Jin, COO at MEXC. “If rate cuts begin soon, we could see even stronger momentum for Bitcoin.”
Earlier this year, Bitcoin’s performance mirrored that of traditional stocks, weighed down by fears around U.S. trade policy. But April has marked a clear divergence. Since President Trump’s “Liberation Day” speech, Bitcoin has surged past $90,000, demonstrating renewed resilience.
“Bitcoin is charting its own course,” said David Hernandez of 21Shares. “Its recent outperformance against the Nasdaq suggests a break from traditional market patterns. As tariff pressures deepen, Bitcoin could further distance itself and become a preferred hedge against policy-driven uncertainty.”
With momentum building and macroeconomic conditions in flux, Bitcoin may be gearing up for its next breakout — and possibly rewriting the rules of market behavior in the process.
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