Bitcoin's Uptrend Faces Inflation Warning from Pentagon

Bitcoin's potential breakout above $80,000 has been hindered by renewed macroeconomic uncertainty. A recent Pentagon briefing to U.S. lawmakers warned that clearing mines in the Strait of Hormuz could take at least six months, and the process will only begin after the U.S.-Iran conflict ends. This could lead to persistently high energy costs, 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. Bitcoin is highly sensitive to interest rates and global liquidity conditions, rather than real economic activity. Rising costs for essentials like fuel and food could also reduce investors' willingness to allocate capital to speculative assets. These risks are reflected in markets, with WTI crude climbing to around $95 and government bond yields rising across major economies. Despite this, U.S.-listed spot bitcoin ETFs continue to show sustained demand, with funds seeing their fastest inflows in a month. However, some analysts are urging caution, arguing that the rally lacks broad-based support in the spot market. The market capitalization of USDT, the largest dollar-pegged stablecoin, has hit a record high of $188.88 billion, while speculation in non-serious tokens is reaching fever pitch. The ratio between bitcoin's price and gold has been steadily rising, with the 50-day average potentially moving above the 100-day average, confirming a bullish crossover.