The decorrelation between bitcoin and the dollar today seems to be running out of steam, with both assets increasing at the same time.

We can no longer stop bitcoin, which has already been trading above $52,000 for several days. The queen of cryptos gained 8% in one week and more than 25% in one month, returning to its levels of December 2021. Bitcoin is no longer far from its all-time high, at $69,000. , reached in November 2021.

Beyond this surge, we see a curious configuration for the bitcoin rally, which is happening in concert with the dollar. Indeed, in the usual market mechanisms of recent years, bitcoin had a tendency to work in the opposite direction to the dollar, with investors returning to it as a somewhat decorrelated asset, a little like gold. Concretely, when the dollar fell, we observed a rise in bitcoin and vice versa.


But here, we have a rather strong dollar, which gains almost 1% over one month if we rely on the Dollar Index, the dollar compared to a basket of representative currencies. This trend can be explained by a favorable monetary context and very firm American rates which improve his remuneration.

Despite the rise in the dollar, bitcoin is operating on its own fundamentals, continuing its surge on the back of the success of the arrival of spot bitcoin ETFs in mid-January and the prospect of halving in April. This goes hand in hand with the sharp rise in stock indices, records set by Wall Street and the European markets. On the investor side therefore, we are observing a resumption of the appetite for risk which is in the sheet of the structural characteristics of bitcoin.

Antoine Larigaudrie with Pauline Armandet


Leave a Reply

Your email address will not be published. Required fields are marked *