Bitcoin Has Swung Wildly Over the Last Week

Bitcoin has swung wildly over the last week as traders ride U.S. president Donald Trump’s tariff rollercoaster (with Michael Saylor’s Strategy issuing a shock warning).

U.S. president Donald Trump is grappling with a growing U.S. dollar "crisis of confidence" that some

> think could boost the bitcoin price.

"The question of a potential dollar confidence crisis has now been definitively answered—we are experiencing one in full force," ING analysts including Francesco Pesole wrote in a note seen by Bloomberg. "The dollar collapse is working as a barometer of 'sell America' at the moment."

The escalating Trump-led global trade war saw the ICE U.S. Dollar Index, which measures the U.S. dollar against a basket of global currencies, fall sharply this week, dropping under the 100 level and putting it on course to return to 2022 levels.

"The market is re-assessing the structural attractiveness of the dollar as the world’s global reserve currency and is undergoing a process of rapid de-dollarisation," Deutsche Bank’s global head of FX research George Saravelos wrote in a note seen by City AM.

The dollar's decline is seen by some as boosting the bitcoin price, as traders bet bitcoin will follow in gold's footsteps, performing as a safe haven asset.

"Like a rising tide, the dollar’s decline is lifting other assets," Alex Kuptsikevich, the FxPro chief market analyst, said in emailed comments, adding "a falling dollar supports cryptocurrencies."

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The bitcoin price has dropped from its all-time high in recent weeks but has outperformed the tech-heavy Nasdaq as the U.S. dollar suffers a "crisis" of confidence.

"Bitcoin’s correlation with U.S. equities may have garnered excessive attention, while its ties to Federal Reserve policy and the U.S. dollar’s trajectory deserve greater scrutiny," LMax Group's market strategist Joel Kruger said via email.

Trump has been pushing Fed chair Jerome Powell to cut interest rates as he embarks on his global trade war, fuelling expectations the Fed could be forced to cut interest rates through 2025, either a response to a tariff-led economic slow down or because Trump has fired Powell.

"Market dynamics are shifting as the Fed’s outlook adjusts to pressures from U.S. trade policy, with expectations of steeper rate cuts in 2025 now taking hold. This pivot toward a more accommodative stance is poised to narrow yield differentials, weakening the dollar’s appeal and, in turn, creating a supportive tailwind for bitcoin," Kruger said.