The Bitcoin and US dollar affair is something that happens to be a fore front issue within the financial market. When it comes to Bitcoin trading volumes by pair the Bitcoin and US Dollar pair sure carries the industry by trade volume followed by Japanese Yen and Euro. However, the two currencies are supposedly inversely related to each other.
Bitcoin and US Dollar price correlation
Expert analysis firm X Force Global explains that the two currencies are definitely in an inversely proportional affair that continues to effect the market since the widening gap can cause difference in value and profits.
The analyst explains that the correlation must be monitored closely since most of the global economy is based on the US dollar prices so in turn, the strength and weaknesses of the currency affect the cryptocurrency market as well. US dollar value benchmarks pretty much everything from commodities to assets and cryptocurrencies. But there are of course regions where Bitcoin is a preferred medium to avoid the US Dollar dependency and inflation such as Argentina.
Although Bitcoin has managed to become the 6th largest currency by circulation the total trade volume and not just that of Bitcoin the cryptocurrency industry as a whole cannot compete with the global trade and financial activities in different fiat currencies and US dollar. At present, the cryptocurrency industry lacks the necessary financial inclusion to compete on that front.
Yet, on the other hand, the inverse relationship between the Bitcoin and US dollar is quite evident, however that was not the case until 2017. The analyst explains that at the time of writing, USD is likely to go down given the uncertainty in the up coming US presidential election and traders are likely to look towards Bitcoin or Gold as hedge funds.
The shift would in turn increase Bitcoin buying to a great extent and while the US dollar prices would be going down, Bitcoin prices would continue to rise.
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