Bitcoin soared past $88,000 before settling around $86,800, following a significant loss in the U.S. dollar as Trump criticized Fed Chair Powell. Over $97 million in Bitcoin shorts were liquidated, as traditional markets like the Dow Jones experienced declines. Investors are re-evaluating the risks, turning to Bitcoin and gold as safer assets amidst growing economic and political uncertainties.
Bitcoin’s value shot up past $88,000 on Monday, eventually settling at around $86,800. This spike represents its highest price point since late March. The surge appears to be linked to a sharp decline in the U.S. dollar, which has hit a three-year low. Concerns over political interference with the Federal Reserve are growing, with over $97 million in Bitcoin short positions liquidated in just 24 hours. Ethereum didn’t fare much better; it saw around $26 million in shorts liquidated as well.
The dollar’s tumble can be traced back to President Donald Trump’s amplified criticisms of Jerome Powell, the chair of the Federal Reserve. Trump took to his Truth Social account, expressing impatience with Powell, stating, “Powell’s termination cannot come fast enough.” Meanwhile, White House economic advisor Kevin Hassett added that the administration is indeed looking into the legality of potentially removing Powell. This tirade has sent markets spinning, pushing the U.S. Dollar Index down over 1%, reaching points not seen since March 2022.
On the flip side, traditional stocks took a dive, with the Dow Jones, S&P 500, and Nasdaq all plummeting about 3% that morning in New York. Market analysts seem worried about the uncertainty surrounding the Fed’s independence combined with broader economic instability. This has led investors to seek refuge in assets seen as safer, such as Bitcoin and gold. Gold, in particular, has hit a staggering high of over $3,420 per ounce.
Interestingly, despite how cryptocurrencies usually mirror stock market movements, Bitcoin’s rise on Monday suggests it’s acting more as a hedge against both political and economic turbulence. Meanwhile, Ethereum remained rather stable at around $1,624, although it’s still down about 20% over the past month. Dogecoin saw a slight increase of about 1.9%, while XRP rose minimally by 0.15%. MATIC experienced a notable jump, up nearly 5%, but Solana faced a small setback, dipping around half a percent. The enigmatic TRUMP token also managed to rise over 2%.
The recent uptick in Bitcoin’s value might also echo new developments in U.S. trade policy. Trump announced “big progress” following discussions with a Japanese delegation, and reports suggest China might resume trade talks if treated with more respect. This development comes against the backdrop of Trump’s earlier pronouncement of a new set of tariffs, which had initially rattled market confidence.
As of now, it seems like while the markets are indeed volatile, the rise in Bitcoin and gold symbolizes a cautious retreat from the U.S. dollar amid ongoing political and economic uncertainties. Investors are navigating treacherous waters, looking for safer shores in the face of potential upheaval.
In conclusion, Bitcoin’s rise to over $88,000, amidst significant liquidations of short positions, scratches beneath the surface of a broader bearish trend in traditional markets. President Trump’s berating comments on Fed Chair Powell have further compounded worry about economic stability, leading investors towards safe havens like Bitcoin and gold. Thus, the current climate reflects a powerful contradiction: Bitcoin, often seen as a high-risk asset, is now standing as a perceived bulwark against looming uncertainties.
Original Source: coinmarketcap.com
