Bitcoin Gains Ground as Gold Hits $3,360 and Dollar Slides
Why Gold’s Rally and U.S. Fiscal Strains Could Fuel Bitcoin’s Rise
As gold surged to $3,360—its highest in over three weeks—Bitcoin hovers above $105,000, capturing attention amid shifting investor strategies. The U.S. dollar’s decline and rising debt concerns are making alternative assets like Bitcoin increasingly attractive.
Gold Climbs as Dollar Weakens
Between May 29 and June 2, gold prices surged 3%, propelled by fears of U.S. fiscal instability and growing skepticism surrounding the Federal Reserve’s policy direction.
At the same time, the U.S. Dollar Index (DXY) fell to a six-week low, signaling diminished confidence in the greenback. Investors, weary of ballooning government liabilities—now $31.2 trillion in federal debt—are exploring other avenues for yield and store of value.
“We are on the warning track,” U.S. Treasury Secretary Scott Bessent told CBS on May 1, emphasizing that the country “is never going to default.”
This warning came after JPMorgan Chase CEO Jamie Dimon flagged potential economic repercussions stemming from a House bill to raise the U.S. debt ceiling by $4 trillion.
A depreciating dollar and debt worries make Bitcoin a standout for investors seeking high-performing, non-sovereign assets. As fixed-income returns remain flat, and the dollar’s value fluctuates, crypto assets like Bitcoin offer a compelling alternative.
If foreign currencies or decentralized assets like Bitcoin begin offering stronger yields, capital could quickly exit dollar-based instruments, further weakening the greenback.
Gold’s Ceiling and U.S. Strategic Dilemma
Though gold is surging, its upside may be capped. The U.S. holds the largest gold reserves globally and could potentially sell part of its stash—worth over $1 trillion—to manage debt or defend the dollar.
Gold/USD (green, left) vs. US Dollar Index (DXY, right). Source: TradingView / Cointelegraph
Even offloading 17% of reserves (around $171.8 billion) would still keep the U.S. far ahead globally. But such a move would only cover three weeks of deficit spending, underlining how limited even massive gold sales would be.
Bitcoin: The Strategic Alternative
A $171.8 billion pivot into Bitcoin, on the other hand, would be geopolitically significant. It would instantly vault the U.S. into the lead as the world’s top holder of Bitcoin, surpassing China’s estimated 190,000 BTC.
This isn’t far-fetched: In March 2025, former President Donald Trump signed the Strategic Bitcoin Reserve Executive Order, setting the groundwork for deeper national involvement in Bitcoin.
Countries with the largest gold reserves, tons. Source: Bestbrokers
Meanwhile, the U.S. isn’t even in the top four gold-producing countries, behind China, Russia, Australia, and Canada, meaning it has little control over gold’s supply—but could exert significant influence over Bitcoin markets with the right moves.
Conclusion: Bitcoin Poised for Ascent
With gold nearing its limit, the dollar in decline, and U.S. debt ballooning, Bitcoin stands to gain from growing investor disillusionment with traditional safe havens. As the macroeconomic storm brews, Bitcoin’s appeal as a strategic hedge becomes harder to ignore.
Rhapsody of Realities is a life guide that brings you a fresh perspective from God’s Word every day. It features the day’s topic, a theme scripture, the day’s message, the daily confession and the Bible reading plan segment. It is God's Love Letter to You!
