U.S. Dollar Strength Threatens Bitcoin Price

For probably about two years now, it has been generally accepted in the cryptocurrency community that “BTC is an independent asset class,” which demonstrates that the first cryptocurrency performs well as an investment tool that hardly correlates with the economic cycle and is not even associated with other asset classes. On August 18, 2020, CoinShares even released a whole report on this, which mainly talked about the lack of correlation between bitcoin and commodities and traditional stocks.

But what about the correlation with the U.S. Dollar Currency Index (DXY)? Max Keiser was one of the first to draw our attention to bitcoin’s negative correlation with the U.S. dollar. In other words, when the U.S. dollar rises, then, as a rule, BTC tends to fall. I’ll also add that there is rarely a positive correlation between BTC and the U.S. dollar.