Data shows Bitcoin (BTC) is only inches away from the same high that helped it reach $ 12,500 earlier this month.
On August 28, the US dollar index (DXY) returned to its decisive lows, abstaining from losses from the Fed’s speech.
A $ 12,000 Bitcoin player appears again
At go-time to the press on Friday, DXY was 92.28 – its lowest level since August 19. At this point the index has been declining for years. 92.17 was the bottom that challenged its April 2018 lows.
Safe havens, including Bitcoin, seemed to benefit throughout the summer as DXY plunged – gold reached a high of $ 2,075 while BTC / USD hit $ 12,500 two weeks ago.
As filbfilb analyst at Cointelegraph Markets noted Friday, there has been a repeat performance now in the program. Fed Chairman Jerome Powell’s speech on Thursday dropped the DXY index after days of gains.
In fact, the impact on the US dollar may be the only significant bitcoin policy change effect many have anticipated.
However, thanks to the Federal Reserve, the effect on the monetary economy’s inertia has been even more severe – so much so that even the votes of paper companies are holding Bitcoin now hampered.
“Jerome Powell’s speech tonight will be for the sake of the history books,” tweeted Andy Yee, Visa’s director of public policy.
“Never in human history has so much been stolen by a very few. Unsubscribing Bitcoin.”
The Fed turned “good for hard assets” to gold and bitcoin
For Raoul Pal, CEO of Real Vision, Powell’s words were an assurance that Bitcoin and gold will remain powerful in the future – but Bitcoin will win over investors.
“I think they’re both rising over time in terms of inflation or deflation,” he told Twitter followers.
“Most people do not understand the latter, but in simple terms, Powell has shown that there is no tolerance for deflation, so they will do anything to stop it and that is good for the hardest assets – gold and Bitcoin. It will inflate.”
Even before the speech, Bitcoin backers had the long-term consequences of Fed policy in mind.
For Saifedean Ammous, author of the popular book “The Bitcoin Standard,” it was a question of “time to tell” for Bitcoin versus Fiat.
“The reduction in the new supply of bitcoins resulted in a significant drop in new sales in the market, which likely helped keep the price high or prevent it from falling further,” he told the Unchained podcast on August 25th.
Central bank quantitative easing, monetary policy for all helicopters and writing all checks seem to have done the same for the stock market. Now let’s see what are the long-term effects of the two methods. “