Bitcoin’s Outlook Improves as Dollar Weakens, but Short-Term Risks Loom

Bitcoin’s future looks promising amid the weakening U.S. dollar, but Real Vision’s Jamie Coutts warns of potential short-term risks that could limit its gains. He highlights rising U.S. Treasury bond volatility and widening corporate bond spreads as factors that could disrupt Bitcoin’s positive momentum.

Treasury Bond Volatility and Corporate Bond Spreads Raise Concerns

Coutts points out that while the U.S. Dollar Index (DXY) has hit its lowest point in months, the increasing volatility in Treasury bonds could tighten market liquidity, possibly prompting central banks to intervene and affecting Bitcoin’s growth prospects. Additionally, widening corporate bond spreads, which have historically correlated with Bitcoin price peaks, signal potential risks.

Long-Term Growth Still Favored by Weakened Dollar and Accumulating Demand

Despite these short-term risks, Coutts remains optimistic about Bitcoin’s long-term growth, driven by the dollar’s weakening and growing strategic accumulation by major players. With strong Bitcoin reserves and dwindling options for central banks, the odds appear to be increasingly favorable for Bitcoin holders in the face of potential market challenges.