Recently, there has been an interesting phenomenon—the US Dollar Index DXY surged strongly in early January, and US Treasury yields also rose. This combination should, in theory, heavily suppress risk assets. But Bitcoin did not fall as expected; it only experienced a slight pullback around $88,000 before rebounding. What does this indicate? The market structure may really be changing.

The logic behind the dollar's appreciation is clear: escalating geopolitical risks, the Fed delaying rate cuts, and economic data exceeding expectations. According to traditional rules, these are all negative factors for Bitcoin. Dollar appreciation means other assets are relatively depreciated, and the simple logic is—BTC should fall.

But now, things are different. More and more institutional investors no longer view Bitcoin as a dollar-denominated asset but see it as a substitute for the dollar. When the dollar strengthens due to political reasons, some are increasing their BTC holdings to hedge risks. This cognitive shift is crucial; it is gradually transforming Bitcoin into a true store of value.

The impact of rising Treasury yields is more complex: higher yields indeed increase the attractiveness of risk-free assets, which theoretically weakens Bitcoin’s relative advantage; but on the other hand, soaring yields often indicate inflationary pressures, which in turn reinforce Bitcoin’s anti-inflationary value. Recent market reactions suggest that the latter logic has a greater influence.

So, don’t analyze Bitcoin with the old framework anymore. The simple logic of "strong dollar, weak BTC" is outdated. To understand the structural changes in capital flows—institutions now treat BTC, the dollar, and gold as part of the same reserve asset category. The correlations have changed, and the game rules have changed accordingly.

From an operational perspective, a strong dollar is actually an opportunity to accumulate BTC on dips. A strong dollar is usually unsustainable; once the Fed shifts to easing, Bitcoin will benefit from dual positive factors: the decline of the dollar + improved liquidity support.