Bitcoin does not benefit from this. THE US dollar remains the reference currency in the world. And when its value drops, it can impact many markets, including that of Bitcoin (BTC) and cryptocurrencies. Historically, a weak dollar has often been synonym of increase for the king of cryptos. Indeed, investors seek to protect against inflation by turning to assets like gold or Bitcoin. However, this time things did not go as planned, as analysts at JPMorgan.
The key points of this article:
The Dollar Index (DXY) fell more than 10.7% year-on-year, but Bitcoin did not benefit from this weakness in the greenback.
Bitcoin has been seen as a risk-on asset, influenced by US monetary policies rather than as a hedge against inflation.
Despite a weak US dollar, Bitcoin is not bullish
According to TradingView data, the Dollar Index (DXY) – which measures the value of the dollar against a basket of other major currencies – a fell by more than 10.7% over a rolling year. In parallel, Bitcoin also has lost 15% of its value over a rolling year. Which is rather opposite to the usual trend, which historically saw cryptocurrency benefit from the weakness of the dollar.
Yuxuan Tanghead of macro strategy in Asia J.P. Morgan Private Bankexplains that this drop in the dollar is mainly due to flux court-terme and at sentiment rather than fundamental changes in monetary policy or economic growth.
The Dollar Index (DXY) has fallen sharply over the past year. – Source: tradingview.com
BTC seems more considered a risk-on asset than a safe haven
The theory would be that Bitcoin behaves like a hedge against inflationa bit like gold, which is currently exploding record after record – with yet another new high at 5 590 dollars l’once this January 29, 2026. However, the reality is more complex for the leader in digital assets. Bitcoin continues to be treated as a active risk-onwhich is therefore above all very liquidity sensitive markets, and therefore to a accommodative monetary policy on the side of the Federal Reserve (Fed) of the United States. Thus, rather than towards the famous cryptocurrency, investors currently prefer to turn to assets such asorl’silver-metal and the emerging markets to exit the US dollar and diversify. As long as the Fed's key rate cut will be pausedBitcoin could therefore continue to lag behind, even with a dollar that remains weak compared to other currencies. Some, like Changpeng Zhao, aka “CZ”, the founder of Binancehowever, remain optimisticif policies favorable to the crypto sector are well implemented in the United States, under the leadership of the Trump administration and the Republicans in the US Congress.