The Current Role of Bitcoin Our quantitative sentiment algorithm applied to Bitcoin provides a much clearer view into the challenges facing the U.S. Dollar. Initially, Bitcoin emerged as an alternative to the Dollar, and at times it functioned primarily as a trading asset. Today, however, it has clearly embraced an anti-Dollar stance. Our algorithm evaluates sentiment by comparing two groups: professional market participants who plan to hold Bitcoin long term and more casual traders looking for short-term gains. It works particularly well with assets that are meant to be part of a portfolio, rather than merely used for trading. Notably, its calculation is entirely mathematical, free from the subjective biases common in other volatility measures. When it comes to Bitcoin, a commitment to long-term holding signals a significant loss of confidence in the U.S. economic system. While assets like gold and the U.S. Dollar Index also reflect similar trends, Bitcoin has especially resonated with U.S. contrarians. The attached chart effectively illustrates this dynamic.
