Diving USD Prompts BTC to Surpass ATH Briefly
Known as the stable currency of the world, things haven’t been looking up for the US dollar of late. It has been experiencing sharp drops and has just extended the losing streak it has been on in the previous 10 months. Considering the current values, it has reached two-and-a-half-year lows, as it had last been trading like this in April 2018. A well-known international agency, Reuters published a rather historical headline relating to this matter. The headline referred to the dip in the US dollar and the rise in Bitcoin, as the cryptocurrency hit an all-time high. The drop in the greenback was primarily because of the US Congress resuming talks about a new financial aid package.
The US Treasury Secretary, Steve Mnuchin and House of Representatives Speaker, Nancy Pelosi, have once again begun negotiations for introducing economic stimulus. While the USD seems to be declining with each passing day, Bitcoin is experiencing some bullish price action. Indeed, the pioneer cryptocurrency has managed to go past its all-time high, even if it was for a brief period of time, and that too for the second day straight. This all took place on Tuesday. The chief executive at ShapeShift, Erik Voorhees has been Bitcoin’s advocate for a long time.
The CEO said that the headline appeared to be something you would expect to see in 2024 and not today. Even so, he did reiterate that it was just one of the numerous similar headlines that were going to be seen in the next few years. As a matter of fact, a number of notable names in the Bitcoin market directly compared the headline by Reuters with the famous headline from the Times that was incorporated in the Genesis Block of the Bitcoin Network. They highlighted the huge changes that have taken place since then.
The USD index is used as a measure of the currency’s value against a basket of other major currencies, which include the Canadian dollar, the Japanese Yen, the Swedish Krona, the Swiss Franc, and the Pound Sterling. Back in 1973, the relative value of the index had started at 100. In October 1984, the dollar index began to reach its all-time high, which was a value of 151. As far as the all-time low is concerned, it happened in April of 2008 when markets crashed and the value slipped to 71.8. In today’s markets, the dollar index has reached 91.1, which is a low that hasn’t been seen by the country in the last two and a half years.
As compared to other currencies, there has been a dip in the USD, along with heavily-traded assets. This includes a big number of commodities and stocks. The devaluation of the reserve currency induced by inflation only increased this year when the US government introduced a financial aid package for providing relief to the economy that was hit by COVID-19. This drove the USD down but worked in favor of Bitcoin, which has only been going up in the last few months. m
