The Trump administration is advocating for a weaker dollar, which asset manager Bitwise believes will be beneficial for bitcoin (BTC), as mentioned in a report released on Tuesday.
“Regarding the tariff initiatives, I am confident about one thing: the Trump administration is looking for a notably weaker dollar,” stated Matt Hougan, Bitwise’s chief investment officer.
After a chaotic week in the markets, cryptocurrencies experienced a rally on Wednesday following President Trump’s announcement of a 90-day suspension of tariffs for nations that haven’t retaliated against the U.S.
A declining dollar has considerable effects on bitcoin.
Bitwise highlights that over the past five years, the cryptocurrency has shown an inverse relationship with the U.S. Dollar Index (DXY). When the dollar depreciates, bitcoin tends to appreciate, and Bitwise anticipates this correlation will persist in the near term.
Looking ahead, the impact of a weaker dollar appears even more favorable, according to the report. “A disruption in the global macroeconomic framework presents a chance for new reserve assets to surface,” Hougan noted.
A shift from the U.S. dollar as the sole reserve currency towards a more diversified system could enhance the roles of hard assets, such as bitcoin and gold, on the global economic landscape, the report elaborated.
Bitwise reiterated its year-end bitcoin price projection of $200,000.
The leading cryptocurrency was priced at approximately $82,300 at the time of publication.
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