Bitcoin's Upward Trend Faces Challenge from Pentagon's Inflation Warning

Bitcoin's momentum towards breaking the $80,000 barrier has been hindered by renewed macroeconomic uncertainty. A classified briefing by the Pentagon to US lawmakers revealed that clearing mines in the Strait of Hormuz, a crucial oil passage, could take at least six months and will only begin after the US-Iran conflict ends. This has led to warnings that gasoline and oil prices may remain high until the midterm elections, potentially keeping inflation elevated and limiting the Federal Reserve's ability to cut interest rates. As a result, risk assets, including bitcoin, may be negatively impacted due to their sensitivity to interest rates and global liquidity conditions. Rising essential costs could also reduce investor appetite for speculative assets. Market indicators such as WTI crude and government bond yields are already reflecting these risks. Despite sustained demand for US-listed spot bitcoin ETFs, some analysts are urging caution, citing the lack of broad-based support in the spot market and the potential for a correction if traders start taking profits. The market capitalization of USDT, the largest dollar-pegged stablecoin, has reached a record high, while speculation in non-serious tokens is increasing. The ratio of bitcoin's price to gold has been rising, with the potential for a bullish crossover, suggesting continued outperformance of bitcoin relative to gold.