- Bitcoin surges past $87,000 for the first time since early April, driven by global liquidity and institutional buying.
- The U.S. dollar weakens amid concerns over Federal Reserve independence, boosting crypto and gold demand.
- Analysts urge caution, calling talk of a new bull market premature due to volatile macro conditions and thin liquidity.
Bitcoin has rallied to over $87,000, marking its highest level since April 2. This is due to institutional interest returning and macroeconomic conditions shifting in its favor.
At the same time, investors are reacting to weakening U.S. dollar strength. This follows President Trump’s criticisms of Federal Reserve Chairman Jerome Powell.
Caution Amid Crypto Climb: Why Bitcoin’s $87K Rally May Be Misleading
While Bitcoin’s recent rally has erased most of the losses from Trump’s April 2 tariff shock, analysts are wary. They are cautious about reading too much into the price movement. Trading volume remains thin, amplified by holiday-season liquidity. This can distort price trends and create exaggerated spikes.
Rising global liquidity is another key factor. The M2 money supply across the U.S., Europe, Japan, and China has climbed to $90.2 trillion. This creates a more favorable environment for speculative assets. Analysts at Kronos Research point to this liquidity growth as a foundational reason for bitcoin’s recovery.
Michael Saylor’s Strategy acquisition added weight to the momentum, reinforcing the idea that big players are still buying the dip. Despite unrealized losses, their conviction underscores bitcoin’s long-term thesis as a hedge against inflation and central bank policy missteps.
Still, macro volatility looms large. Political instability, rate uncertainty, and the threat of more aggressive U.S. trade policies could swing sentiment quickly. Until stronger confirmation appears, the market remains cautiously optimistic but far from euphoric.
Bitcoin’s bounce above $87,000 shows renewed strength. However, with thin liquidity and unstable macro signals, caution is still the smarter play for now.
“Bitcoin has no counterparty risk. No company. No country. No creditor. No currency. No competitor. No culture. Not even chaos.” – Michael Saylor
