Dollar Hits 3-Year Low, Bitcoin Surges 4.27%

The U.S. dollar experienced a significant decline, reaching a three-year low of 98.415 on April 21, 2025. This drop marked the longest five-week decline since November 2022, with the dollar losing 0.999% of its value in a single day, resulting in a 989-point decline. The depreciation of the dollar was influenced by various factors, including comments made by President Donald Trump, who urged the Federal Reserve to reduce interest rates through his Truth Social platform. Trump's assertion that inflation is "virtually nonexistent" due to declining energy and food prices added to the market pressure on the dollar.

Trump's comments directed at Federal Reserve Chair Jerome Powell to take immediate action to prevent economic stagnation further destabilized financial markets. This created tension as Trump's push for rate cuts contrasted with the Fed's mandate to maintain independence in monetary policy decisions. The depreciation of the dollar has significant implications for international trade, with international customers benefiting from cheaper exports due to the declining dollar value. However, escalating import prices could affect U.S. prices and trade relations with major economic partners like Mexico and Canada.

Meanwhile, Bitcoin thrived as the dollar faltered. CoinMarketCap reported Bitcoin trading at $87,200, with a 4.27% increase in one day, peaking at $88,430. The Bitcoin market value reached $1,735,010,920,445, with a circulating supply of 19,854,290 BTC. Bitcoin's historical price movements show its resilience against market fluctuations, providing a defense against dollar devaluation. The cryptocurrency market has expanded significantly, surpassing $2.7 trillion due to Bitcoin's price appreciation and institutional investments.

Multiple currencies gained additional market value due to the weakening of the U.S. dollar in foreign exchange. The euro, for instance, strengthened by 4.5% against the dollar this week due to European defense funding growth, which serves as a response to deteriorating U.S. relations while simultaneously strengthening the economy. The weakening dollar has also led to increased interest in alternative assets like Bitcoin, which is seen as a hedge against financial system instability.