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The US Dollar Index (DXY) is slipping—and fast. Since Donald Trump reentered the White House, we’ve seen a significant drop in the dollar’s strength, with the DXY now trading below the critical 100-point mark. For many crypto watchers, this is more than just a stat—it’s a flashing green light for Bitcoin bulls.

What Does a Falling DXY Mean for Bitcoin?

While Bitcoin’s relationship with the US dollar isn’t always linear, history suggests that the digital currency often thrives when the dollar stumbles. The DXY represents a basket of major world currencies against the USD, with the euro holding the most weight. A dip below 100 usually reflects broader weakness in the greenback, and that’s where Bitcoin starts to shine.

According to Bitcoindata21, current chart patterns resemble those seen in 2017, a year that culminated in Bitcoin reaching a historic all-time high. If history repeats—and crypto markets do love a good rerun—we could see a new BTC ATH by the end of 2025.

But There’s a Catch—Trump’s Trade War Looms

Despite the bullish signals, there’s a storm cloud on the horizon. Donald Trump’s trade war is creating serious uncertainty across global financial markets. And as any seasoned investor will tell you, uncertainty and risk assets don’t mix well—unless you’re a degenerate gambler or a laser-eyed maximalist.

The question now is whether this bull market has fuel for another leg up. If you’re asking the macro guys, the answer might be yes.

Global M2 Money Supply Hits All-Time Highs

Here’s where things get spicy: the global M2 money supply, measured in USD, is skyrocketing and has already hit record highs. Why does that matter? Historically, Bitcoin tends to follow the M2 curve. More money sloshing around means more liquidity chasing fewer assets—which tends to pump up everything from stocks to crypto.

Crypto influencer Colin Talks Crypto chimed in, noting:

“Global M2 has remained at an ATH for 3 days in a row. This is a fantastic sign for what it signals will be coming into risk assets in ~108 days. (See upper-right corner of chart).”

Translation: This might be your chance to buy the dip—if you’re brave enough.

The Trump Factor

Of course, there’s always a wildcard—and in 2025, his name is Donald J. Trump. If Trump intensifies the trade war, that could throw a wrench in Bitcoin’s climb to new highs. Tariffs, capital controls, or unexpected tweets could easily derail bullish momentum.

Conclusion: Risk, Reward, and a Weakened Dollar

The falling DXY, surging M2 money supply, and growing whispers of a Bitcoin breakout paint an exciting picture for crypto bulls. But let’s not forget—macroeconomic chaos and political turbulence can be both an opportunity and a curse.

Is this 2017 déjà vu or just a dollar-fueled head fake?

One thing’s for sure: Bitcoin thrives on volatility, and in 2025, there’s plenty to go around.

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Margharet Tess

Editor, Developer at Cryptheory Labs

I have been active in the cryptocurrency world for over 6 years, during which I have written countless articles about this sector. What fascinates me most about cryptocurrencies is their technological aspect and the problems they aim to solve. In the past three years, I have ventured into app development and am currently working on a larger project called P2E Buzzer. Stay tuned for the surprise. 🙂 My previous experiences: Business2Community.com, TradingPlatforms.com

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