Reflation signals turn bullish for Bitcoin

Global markets are showing signs of reflation, a shift back toward rising inflation pressures that analysts say has historically been supportive for asset prices, including bitcoin.

Rising commodity prices and currency moves suggest capital is rotating out of US Treasuries and into inflation hedges, with gold hitting a record $5,500 and silver up about 50% so far this year.

“Both commodity markets and FX markets are sending clear signals for a renewed global reflation,”

Said André Dragosch, head of research at Bitwise Europe.

Reflation typically emerges when inflation begins rising again after a slowdown, often driven by higher commodity prices, weaker currencies and renewed liquidity, conditions that have previously lifted bitcoin prices.

Dragosch and former BitMEX chief executive Arthur Hayes have suggested the Federal Reserve may already be intervening in foreign exchange markets alongside Japanese authorities, a move that would expand dollar liquidity.

US Treasury Secretary Scott Bessent denied such intervention, telling CNBC that the administration maintains a “strong dollar policy”.

Hayes said he is watching the Fed’s balance sheet for signs of rising foreign-currency assets, arguing that once liquidity clearly expands, “bitcoin will pump alongside a growing Fed balance sheet.”

At the time of reporting, Bitcoin price was $82,392.65.