- Bitcoin has hit new all-time highs when priced in currencies like the Chinese yuan, Japanese yen, British pound, and Indian rupee, even though it remains below its November 2021 peak in US dollars.
- This is largely due to the surging US dollar, which has climbed 10.7% since November 2021, causing many other global currencies to decline versus the dollar.
- Countries like Japan have seen their currencies devalued, leading to record bitcoin prices when denominated in their local currencies, as liquidity flows into bitcoin amid fiat currency weakness.
While bitcoin remains below its November 2021 peak in U.S. dollars, it has already reached new heights when priced in other currencies around the world. This is largely due to the strengthening U.S. dollar.
The Surging Dollar
The U.S. dollar index has climbed 10.7% since November 2021. As a result, many global currencies have declined versus the dollar. Bitcoin has hit fresh highs priced in the local currencies of major economies like China, Japan, the UK, and India. It has also reached new peaks in developing countries including Argentina, Turkey, and Egypt.
“U.S. growth has stayed very robust compared to Europe, the UK, and Japan, which has supported the [U.S. dollar],” said Aurelie Barthere, an analyst at Nansen, in a note to CoinDesk. “However, this is less clear going forward, as we have seen weak U.S. consumption and housing data. I see the DXY linked to crypto prices through the intermediary of the rates channel.”
Bitcoin in Japan
Japan has been a prime example, with a 24% drop in the yen leading bitcoin to hit a record high well before this week’s surge in bitcoin’s dollar price.
“Japan’s government has been devaluing the yen, and the flow of liquidity has trickled into bitcoin as their fiat has weakened,” explained Zheng March, Managing Partner of Bizantine Capital, in an interview with CoinDesk.
Conclusion
While bitcoin has yet to exceed its all-time high in U.S. dollars, its growing dominance in other currencies demonstrates its increasing global appeal as a store of value amid economic uncertainty.
