I need to know:
Lyn Alden says the US needs a weak dollar to stabilize the financial system.
Bitcoin and gold are well deployed to receive benefits from dislocation.
Sovereign funds and various countries are already increasing Bitcoin exposure as the dollar’s global dominance begins to disappear.
The weakening of the US dollar is no longer headline news. As the interruption was applied throughout the US economy, the decrease in the green background became part of the background. Since early 2025, the US dollar index has decreased 11%, and is currently crossing the last level in April 2022. The market responded greatly with RUG. After all, isn’t some dollar weakness at the time of deep restructuring?
The problem is that this may not be a temporary dip. Slides of the dollar can reflect deeper and long -term reconstruction of the US economy and global currency order. At the newsletter on May 4, Lyn Alden, an independent market analyst, created a convincing example. Not only is the dollar weak, but it can be needed. According to ALDEN, the controlled retreat of Dollar Hegemony may be one of the remaining few paths to stabilize the increasingly broken system. And if the United States gives up its role at the center of the currency universe, the world will need alternatives. Neutral assets, such as gold and bitcoin, can play more central roles.
The US and the dollar are in “long -term transition”.
Fractional Reserve Banking, a system that features the FIAT MONEY, makes money through loans. Every time a bank issues a loan, it expands the supply of a wide range of money without making enough basic funds to cover the loan principal and interest. This means that the current financial system relies on continuous credit expansion and relies on refinancing to maintain the solvent.
Today, the US economy has about $ 102 trillion in public and private dollar cover liabilities, and $ 18 trillion is owed by borrowers other than the United States, which will not be calculated by calculating derivatives.
But the basic funds are only $ 5.8 trillion.
“This is like a musical chair game with more than 20 children in every chair.”
The United States plays a special role in this system. Surplus countries return dollar income to US stocks, bonds, real estate and private equity funds, while importing more income than exports. With US $ 18 trillion dollar debt, non -US organizations have about $ 61 trillion in US dollar assets. However, if the dollar liquidity is strengthened when the music stops, foreign holders often have to sell their assets to provide debt, which threatens the US’s financial stability.
This happened in March 2020 when a part of the financial market was frozen at the top panic stage of Covid-19 Pandemic. The Fed resigned and opened the emergency swap line as a foreign central bank and printed one trillion with basic money to play the system. It solved the liquidity problem, but it solved the inflation, and the low -income Americans did the most difficult things.
In the meantime, the decades of industrial decline and social gaps have led to a political mission for Donald Trump and his protectionist agenda. But tariff shocks are unlikely to be successful, Alden argued. The current system suggests that the US needs to operate a rescue trade deficiency in order to provide the dollar to the Earth economy to maintain Greenback’s dominance. The only way to reinforce the trade flow is to withdraw from weak dollars and monetary hegemony.
As Alden said
“I actually believe that the global financial system has begun a very long -term shift.”
DXY relationship in Bitcoin
Bitcoin (BTC) and DXY are inversely proportional. If the dollar is strengthened, risk assets such as BTC will lose their appeal to investors. When the dollar weakens, the BTC is more attractive not only in speculation but also with alternative currencies. Bitcoin’s fixed supply and monetary neutrality provides powerful hedges in a system that Fiat must effectively lose value over time.
Overlaying the BTC and DXY charts often matches the main divergence between them. In April 2018 and March 2022, these differences announced the Bear Market, while in November 2020, an optimistic rally began.
At the 2023-2026 cycle, the BTC followed the DXY in early 2024, and the two were greatly synced until recently. The clear divergence began in early April 2025, and DXY fell to less than 100 for the first time in two years.
If the pattern of the past is a guide, this can be seen in the beginning of a new BTC rally. And if the United States moves to strategically weaken the dollar in the long run, the impact can expand beyond Bitcoin’s general periodic price behavior.
relevant: How many Bitcoins can Berkshire Hathaway buy?
Where should I invest in the days?
Monetary catastrophe is difficult to explore. Short -term tactics may be different, but long -term strategies refer to neutral high -quality preliminary assets, especially assets that benefit from dislocations.
Gold fits this bill. The same is true for Bitcoin.
Some sovereign agencies are already stocking Bitcoin. El Salvador and bhutan are directly purchasing and mining BTC. ABU DHABI’s Mubadala Investment Co. and the US Wisconsin Pension Fund are exposed through Spot BTC ETF. Twelve US stocks have a strategy of Michael Saylor and more than 13,000 companies and institutions. Even Norwegian sovereign assets funds have bitcoin exposure through strategy, mara holdings, coinbase and riots.
If the dollar retreats in the global financial sector, the space opens for another currency. There are more cases of international trade transactions settled in comfort, Durham or other national currency. Reuters reported that in March, the border comfort payment was recorded. The euro also increased, increasing 10% from the dollar since February. This is more impressive, considering that the European Central Bank continues to cut interest rates and is only 2.5%, which is much lower than the Fed’s 4.5%.
Many collected “gold shoes” are no longer virtual. It is unfolded in real time. When the state and the company find a stable and neutral alternative to solve trade and storage value, Bitcoin’s border and politically neutral nature deploy them as serious competitors.
This article does not include investment advice or recommendation. All investment and trading measures include risks, and the reader must do his own research when making a decision.