US Dollar decline pushed Bitcoin above $120k bringing Hyper Bitcoinization closer

Bitcoin has surged from $108,000 to over $120,000 successful little than a week, extending its assertive uptrend and hitting caller all-time highs connected astir each trading day.

While the US dollar terms of Bitcoin keeps soaring, the aforesaid momentum has been much muted successful different fiat currencies similar the euro and British pound.

The divergence is tied to the declining spot of the US dollar. Since January, the dollar has dropped implicit 10% against the lb and continues to autumn against the euro.

This weakening inclination has go a focal constituent for marketplace participants who presumption it arsenic a broader awesome of economical instability and a catalyst for what immoderate are calling a caller signifier of “bitcoinization.”

Weakening US dollars

Analysts astatine Kobeissi Letter pointed retired that the marketplace is entering “crisis mode,” noting that Bitcoin is present rising successful a near-vertical line.

According to the firm, Bitcoin is successful uncharted territory arsenic the US rates are climbing, the dollar has fallen by 11% successful conscionable six months, and implicit $1 trillion has been added to crypto’s full marketplace headdress successful the past 3 months.

The economical investigation level further noted that 2 large turning points person shaped Bitcoin’s show successful 2025: the April 9 intermission connected US tariffs and the July 1 transition of President Trump’s “Big Beautiful Bill.”

Bitcoin Price Performance (Source: The Kobeissi Letter)

Since the latter, Bitcoin has added much than $15,000 to its price, reinforcing the inverse correlation with the US Dollar Index.

Adding to the bullish narrative, institutional investors look to beryllium flooding into Bitcoin. BlackRock’s spot Bitcoin ETF, IBIT, has amassed $80 cardinal successful assets nether management successful conscionable implicit a year, a milestone that took the apical golden ETF much than 15 years to reach.

Capital rotation into Bitcoin

Moreover, arsenic Bitcoin rallies, accepted assets are opening to lag. The S&P 500, erstwhile measured successful Bitcoin, is down 15% year-to-date and has declined astir 99.98% since 2012.

S&P 500 Priced successful Bitcoin (Source: The Kobeissi Letter)

While immoderate construe this arsenic a informing for bequest markets, others spot it arsenic confirmation that Bitcoin is entering a caller signifier of dominance that would pull further global liquidity to the asset.

Jamie Coutts, the main crypto expert astatine Real Vision, echoed this sentiment, pointing retired that Bitcoin’s 40% rally since April aligns with a breakout successful planetary liquidity aft a three-year downtrend.

Global Liquidity Index (Source: Jamie Coutts)

According to Coutts, each 1% emergence successful planetary liquidity could construe into a 20%+ summation successful Bitcoin’s price, a dynamic highlighting the standard of superior rotation into crypto.

He added:

“While this elemental exemplary accounts for the continuation of the hoovering of superior from each corners of the globe into Bitcoin, it doesn’t relationship for the inevitable ‘oh sh#t’ infinitesimal of panic buying that is going to happen…eventually. It volition beryllium champion of times, it volition beryllium the worse of times.”

The station US Dollar diminution pushed Bitcoin supra $120k bringing Hyper Bitcoinization closer appeared archetypal connected CryptoSlate.