Deutsche Bank Alerts of a Geopolitical Fragmentation Megashock for BTCUSD as Trump Diminishes Dollar
Deutsche Bank issues a warning about a potential collapse of the USD, driven by tariffs and geopolitical changes. BTC might experience a rise as a safe-haven asset, potentially elevating BTCUSD to new peaks.
Global focus remains on U.S. tariff strategies. If these strategies stumble, Bitcoin and other top cryptocurrencies to purchase may encounter hurdles in a risk-friendly atmosphere. With attention on Donald Trump, Deutsche Bank analysts contend we are witnessing the onset of significant geopolitical and financial transformations that could dramatically influence global markets, providing direct advantages to BTC and alternate assets.
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Deutsche Bank Highlights Threat to USD
In a communication to clients, George Saravelos, head of FX Research, alerted that the USD’s position as a reserve currency and safe haven faces significant risks. Together with strategist Tim Baker, Saravelos amplified these apprehensions, pointing to a series of structural changes in U.S. financial and economic practices that could trigger a “megashock” in global markets.
This alarming mix of tariffs, which now characterizes U.S. trade relations worldwide, growing political unrest, and the U.S. reconsidering its role in global leadership may drive a prolonged decline in the dollar. “The groundwork is now established for the onset of a significant dollar bearish,” declared Saravelos and Baker.
Experts express concern that elevated U.S. tariffs will heighten operational expenses, especially for businesses dependent on imports or raw materials, inevitably passing these costs onto consumers. This fosters an inflationary climate, worsened by the Trump administration’s increasingly aggressive trade practices.
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Furthermore, elevated tariffs, particularly with China, are expected to remain in place, as Treasury Secretary Scott Bessent suggested that a complete deal could take years. This prolongs unpredictability and escalates market fluctuation, hindering momentum in digital currency values, including those of the top Solana meme coins for Q2 2025.
In addition, in light of Trump’s criticisms of the Federal Reserve and Jerome Powell, the central bank might cave to political influences and implement rate cuts beyond the two anticipated reductions.
Should they acquiesce to this pressure, heightened inflation alongside lower borrowing costs could elevate price pressures, pushing BTC to new heights as investors seek to safeguard their investments.
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As USD Falters, Will BTC Thrive?
The USD Index is plummeting, falling below 100 to nearly 99 in April 2025. It has dropped 8% from its peaks in 2025.
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Goldman Sachs analysts predict that the dollar could depreciate by close to 10% against the euro, yen, and pound by the year’s end.
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In the context of U.S. trade conflicts, Goldman Sachs assesses a recession risk of 45%, up from 35%. They indicated that tariffs will diminish citizens’ actual income, placing more strain on an already vulnerable economy.
As the USD weakens, Jay Jacobs of BlackRock foresees that geopolitical fragmentation could forge a “megaforce” that will shape global finance for years to come. He added that in reaction, investors are likely to flock toward decentralized, non-sovereign stores of value, notably Bitcoin. Some of the new cryptocurrencies to consider in 2025, such as Hyperliquid (HYPE), could experience significant gains accordingly.
“The increase in geopolitical fragmentation is directly linked to Bitcoin’s rise as individuals seek security in the face of instability while looking for alternative asset classes,” Jacobs noted.
He pointed out that BTC is moving away from its connection with tech stocks. It currently follows a distinct trajectory as a safe haven and digital gold.
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Deutsche Bank Anticipates USD Decrease, BTCUSDT To New Records?
- Deutsche Bank and Goldman Sachs predict a drop in the USD due to Trump’s tariffs
- Experts forecast a “megashock” from U.S. trade tensions and political uncertainty
- Significant tariffs on China and other nations may push consumer prices higher
- Trump’s critiques of the Fed could lead to rapid rate cuts, further weakening the USD
The article Deutsche Bank Warns of Geopolitical Fragmentation Megashock for BTCUSD as Trump Weakens Dollar originally appeared on 99Bitcoins.
