The Dollar Is Melting. Bitcoin Just Hit $112K.

Last week, on Friday, May 16th, Moody’s downgraded U.S. government debt.

The last standing AAA rating the US had was gone.

It was stripped away under the weight of a $36 trillion national debt and interest costs now seriously threatening the country’s fiscal stability.

By Monday, the impact started to show. The 10-year Treasury yield jumped to over 4.5 percent, gold hit new highs, stocks were uncertain, and…

Bitcoin surged:

It crossed its prior all-time high (ATH) of $109,000 and then proceeded to hit new ATHs, reaching almost $112,000.

Not because of hype or FOMO, but because people were losing faith in the system. This wasn’t an isolated event. It was a tipping point in a series of fractures in public trust.

Investors around the world weren’t shocked. Many had seen it coming. The downgrade didn’t surprise them. It confirmed what they already suspected.

The old financial model was no longer working. Bitcoin didn’t rise despite the crisis. It rose because of it.

And that’s a signal you must pay attention to because Bitcoin hitting ATHs without FOMO or hype has never happened before.

This Rally Was Built on Fear

This rally is being driven by fear that can no longer be ignored. That fear is rooted in hard numbers and recent history.

• Fear that inflation won’t go away.

• Fear that national debts will never be brought under control.

• Fear that the people in charge of fixing things can no longer do so.

In March 2023, cracks in the U.S. banking system became impossible to hide. Several banks failed. Credit Suisse came dangerously close to collapsing. While the S&P 500 slipped, Bitcoin rose by 21 percent.

That was the first major sign that something had changed. Bitcoin had started to behave like gold.

Now, with the credit downgrade, it’s doing it again. But this time, the context is far worse. Inflation has lingered. Debt has grown. Political gridlock has intensified.

Moody’s didn’t cause Bitcoin to rise. It simply confirmed what many already felt: that the system isn’t just struggling—it might be structurally broken.

Bitcoin has become the place people go when they feel like the system can’t protect them.

Why Confidence Is Breaking Down

1. Inflation and Currency Concerns

Over the last few years, inflation hit levels not seen since the early 1980s. The Federal Reserve initially dismissed even the possibility of inflation. When it became clear that inflation was here, they said it was transitory. When it became out of control, they raised rates at record speeds.

The cost of money rose, but so did the cost of living.

Wages haven’t kept pace. Rent, food, energy, and almost every essential costs more.

Families are being forced to make choices they didn’t have to make before. And more people now understand what it means when their money loses value.

Bitcoin doesn’t inflate. It has a hard limit of 21 million coins. That makes it fundamentally different from fiat currencies. You can’t print more of it. You can’t manipulate the supply to fund a political agenda.

2. Government Debt Is Out of Control

The world’s debt load is now $324 trillion. The U.S. runs massive annual deficits and borrows more each quarter. Interest payments alone are eating into the national budget, and nothing is being done to slow it down.

Credit downgrades were once unthinkable. Now, they’re a reality. Investors are beginning to realize that the idea of U.S. Treasuries being “risk-free” is starting to look outdated.

3. Geopolitical Risk Is Everywhere

The global political landscape is unstable, from the ongoing war in Ukraine to growing tensions in the South China Sea. These tensions affect global trade, supply chains, and capital flows.

In that kind of environment, people and institutions look for places to store value outside of traditional systems. Central banks are buying gold, individuals have been buying Bitcoin, and now institutions are buying Bitcoin, as you’ll see below.

Bitcoin doesn’t care about borders. It doesn’t rely on trust in any one government, which is becoming more appealing in a world where trust is in short supply.

This Time Is Different

This is not like the previous cycles where retail investors chased headlines, greed, or FOMO.

This current rally has a different set of players. Institutional investors are here.

BlackRock, Fidelity, and Vanguard have launched Bitcoin ETFs.

In May alone, those ETFs pulled in $3.6 billion.

According to multiple industry analysts and ETF fund flow data, by the end of 2024, institutions were estimated to hold between 2 and 3 percent of all circulating Bitcoin.

These are pension funds, endowments, and large asset managers. They don’t chase memes. They follow mandates. They have compliance departments and fiduciary responsibilities.

What changed their minds?

Several things: regulatory clarity, improved infrastructure, and, most importantly, the need to find assets that offer real protection in an increasingly unstable world.

For years, the narrative was that Bitcoin was too volatile to take seriously. That has shifted.

The real risk is not owning any at all.

Bitcoin’s current surge is being fueled by concern. The kind of concern that doesn’t go away overnight.

Currencies are weakening, debt loads are expanding, and central banks are stuck between inflation and recession.

The public is growing tired of hearing that “everything is under control.”

Bitcoin is not a perfect asset, but it is transparent, limited in supply, and does not rely on the promises of any central authority.

It’s acting as a hedge against system-wide failure. Against the risk that the levers of the old system simply don’t work as they used to.

Every new investor in Bitcoin is casting a vote. And that vote says, “I don’t fully trust what’s happening anymore.”

What Comes Next

Bitcoin will keep climbing.

Not because of hype, but because of structural reasons.

A recent shareholder proposal to add Bitcoin to Microsoft’s corporate treasury was rejected, but the very fact that it was seriously considered highlights how far Bitcoin has come.

The U.S. has now established a strategic Bitcoin reserve—something that was once considered fringe policy. This move has legitimized Bitcoin at the national level and accelerated conversations globally. With one of the most influential governments formally holding Bitcoin, projections of $500,000 are no longer speculation.

Bitcoin ETFs are bringing the asset into everyday retirement accounts. Platforms like Fidelity now offer exposure to crypto through 401(k)s.

Even Jamie Dimon, a longtime critic of Bitcoin, announced that JP Morgan Chase will allow people to buy it.

This kind of access wasn’t possible five years ago.

The barriers are falling, adoption is rising, and credibility is growing.

What You Should Do

Here’s what not to do:

Don’t wait for more headlines. The big players are already acting.

Don’t wait for an all-clear from traditional finance. It won’t come until it’s too late.

Don’t wait until Bitcoin is completely out of reach. You don’t need a perfect entry. You need exposure.

Here’s a simple plan:

Step 1: Open a brokerage or crypto exchange account. Coinbase, Kraken, Gemini, or Fidelity all work.

Step 2: Buy a manageable amount. You don’t need a whole coin. Start with what makes sense for you.

Step 3: Hold. Not for a quick win, but for long-term positioning.

Even a small position gives you a foothold. It gives you a stake in something moving in the opposite direction of a weakening system.

Bitcoin is not just another asset. It’s a signal. It tells us something about where trust is going. And trust is shifting—fast.

You don’t need to wait for permission. The world is already changing.

The only question left is whether you will adapt to it or ignore it.

Double D

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