Behind Bitcoin's New Historical High: Weakening Dollar and Dual Push from Capital Getting on Board

In the early hours of today, the price of Bitcoin broke through the $112,000 barrier, setting a new historical high. Behind this surge are the combined effects of multiple factors, including the continued weakness of the dollar, ample global liquidity, and accelerated inflows of institutional funds. This article will review recent market dynamics, analyze the impact of geopolitical situations and economic data on risk assets, and explore Bitcoin's unique performance in this round of rebound and its future trends.

June Market Review

In June 2025, the market was shrouded in trade uncertainty, geopolitical conflicts, and complex economic data. However, despite the severe macro environment, risk assets generally rebounded. The U.S. stock market rose across the board, with both the Nasdaq 100 index and the S&P 500 index reaching all-time highs. Bitcoin briefly fell below $100,000 in the middle of the month but then rebounded strongly, posting a monthly increase of 2.84%. In contrast, the overall cryptocurrency market fell by 2.03%, with Ethereum showing significant volatility, underperforming other mainstream assets with a decline of 2.41%.

At the beginning of the month, the market was generally optimistic, with investors actively digesting macroeconomic data and geopolitical situations. Although US-China trade relations were tense for a while, they eased after a conversation between the leaders of the two countries. China's manufacturing PMI fell to a recent low, and the OECD again lowered its global growth expectations. US economic data was mixed: employment data showed strong performance, but retail sales declined. June's CPI fell below expectations again, reinforcing the view of cooling inflation. The Federal Reserve kept interest rates unchanged for the fourth consecutive time at the June FOMC meeting, stating that it needs to wait for clearer signals regarding inflation and the job market.

The crypto market experienced several short-term shocks in June, including controversies over tax policies and a brief escalation in geopolitical tensions. By the end of the month, Bitcoin rebounded as market sentiment improved and institutional participation increased. The total net inflow for Bitcoin ETFs in June exceeded $4 billion. Ethereum faced higher volatility and deeper corrections, with the specific reasons still unclear. At the same time, crypto treasury strategies gained attention, as several companies began to expand their holdings to non-Bitcoin assets, demonstrating market recognition of this strategy.

In late June, geopolitical issues became the market focus. The situation in the Middle East suddenly escalated, attracting global attention. Although the conflict intensified for a time, the situation gradually eased under diplomatic mediation. The cryptocurrency market stabilized after initial fluctuations, while traditional safe-haven assets like gold and crude oil fell back, reflecting a decrease in market concerns about a prolonged conflict.

June Highlights Overview:

• The crypto treasury craze: Currently, 53 companies have engaged in crypto treasury allocation, covering 8 different crypto assets.
• Demand for stablecoins accelerates: After the relevant legislation is passed, multiple companies are preparing to issue their own stablecoins.
• Geopolitical Situation: The Middle East conflict has drawn global attention, but its impact on risk assets is limited.

Diversification trend of crypto asset allocation

An unexpected trend in 2025 is the rapid adoption of crypto treasury strategies by enterprises, especially in June, where this trend accelerated significantly, with the number of related companies nearly doubling. Measured by trading volume, in June, the scale of Bitcoin purchases by crypto treasury companies exceeded the total net inflow of the US spot Bitcoin ETF for that month (4 billion USD).

Although Bitcoin and Ethereum still dominate, an increasing number of companies are beginning to allocate a broader range of crypto assets, such as SOL, BNB, TRX, and HYPE, indicating an increasingly strong trend of diversification beyond mainstream coins. According to the data, among the 53 confirmed crypto treasury companies, 36 focus on BTC, 5 allocate SOL, 3 allocate XRP, 2 respectively allocate ETH, BNB, and HYPE, and another company allocates TRX, FET, as well as a comprehensive altcoin investment portfolio.

This trend is expected to continue, as companies continue to drive this strategy, and the market shows a strong willingness to provide ample funding and support for multi-asset allocation.

However, the market has started to question this strategy, especially as some companies are leveraging debt financing for crypto asset allocation, raising concerns about potential leverage risks. Currently, zero-interest or low-interest convertible bonds are commonly used; these bonds, if "in the money" at maturity, allow investors to convert them into company equity. However, if "out of the money", the company must repay the principal and interest in cash, which may lead to liquidity and solvency issues. Some companies even lack sufficient cash to pay interest.

In this case, the company usually has four response options:

1. Selling crypto assets to raise funds may put downward pressure on market prices.
2. Issuing new debt to repay old debt is equivalent to refinancing.
3. Issuing new shares for financing, to repay debts or acquire additional assets.
4. If the asset value is insufficient to repay the debt, it may default.

The path the company ultimately takes will depend on the market conditions at the time of expiration. Generally speaking, the company may only resolve issues through refinancing when the market allows.

In contrast, the method of increasing cryptocurrency assets by issuing stocks carries less risk, as it does not involve debt and does not create a mandatory repayment obligation, making it more easily accepted by the market within the overall risk structure.

According to recent reports, the current market concerns about the leverage structure may have been amplified. Most of the debt issued by Bitcoin treasury companies will mature between June 2027 and September 2028. Although the crypto industry has historically faced systemic risks triggered by high leverage, at present, this type of debt structure does not pose an imminent threat. However, it is worth noting that if more companies adopt this strategy in the future and issue shorter-term debt, the potential risks will gradually accumulate.

The stablecoin industry is迎来重要转折

June 2025 will be a pivotal turning point in the stablecoin industry, primarily driven by two major events: a stablecoin issuer successfully going public, and the U.S. Senate passing relevant legislation, which is the first comprehensive stablecoin legislation in U.S. history.

As the world's second-largest stablecoin issuer, the company became the first native stablecoin company to go public in the United States, with its stock price soaring more than six times in June. Despite such a significant increase suggesting that the IPO pricing may have been too low, more importantly, investors' recognition of the future infrastructure role of stablecoins has significantly strengthened.

On June 25, the relevant bill was passed in the Senate with a vote of 68 to 30, marking a breakthrough after months of procedural voting and political maneuvering. The bill has now been transferred to the House of Representatives, where some lawmakers have suggested integrating it into a broader bill. However, the prospects for merging remain unclear, especially in the context of Trump's public opposition.

Under regulatory impetus, companies' interest in stablecoins continues to heat up. Several retail giants in the United States are considering issuing their own stablecoins; a certain payment giant is further expanding ecological support by integrating stablecoin products from multiple companies. These companies are not only vying to issue stablecoins but also hope to take the lead in circulation scale and actual usage. The industry's focus has shifted from "whether to issue" to "whether to land," and the success of stablecoins will depend on their penetration in real payment scenarios and user coverage.

On the international front, this trend is also gradually spreading. For example, a certain crypto company has obtained regulatory approval for its stablecoin in Dubai, and the Bank of Korea is also exploring the issuance of a stablecoin pegged to the Korean won. However, the development in the United States is currently the most advanced.

Stablecoins are just the starting point. They mark the first phase of bringing traditional fiat currency onto the blockchain, achieving the deployment of an all-weather, fast-interoperable infrastructure. The focus of the next phase will be the introduction of on-chain financial assets, with the first being stock tokenization.

A certain trading platform has recently launched tokenized trading of 200 listed stocks for users in Europe, becoming a pilot platform to test user demand and execution quality. Another cryptocurrency exchange is also seeking corresponding regulatory approval in the United States to promote similar products. These early attempts pave the way for more traditional financial products to be brought on chain, and the next step is expected to cover asset classes such as private credit and structured funds.

The impact of geopolitical conflicts on the market is limited.

The Middle East conflict that broke out on June 13, 2025, lasted for 12 days. Although it attracted global public attention, its long-term impact on risk assets was limited. In the early stages of the conflict, the crypto market and stock market reacted mildly; however, after the U.S. government initiated military action on June 22, the prices of crypto assets experienced a significant drop. With the announcement of a ceasefire agreement on June 24, prices rebounded quickly. Despite sporadic conflicts still occurring by the end of the month, the market overall has stabilized.

During this period, the Bitcoin trend rose in sync with the US stock market, showing no safe-haven properties. Compared to the performance of Bitcoin in April and May when it was viewed as a store of value asset due to trade tariffs and global bond market tensions, this time it leans more towards risk asset logic. Bitcoin outperformed gold and the overall cryptocurrency market, partly attributable to strong institutional support, including monthly ETF inflows reaching $4 billion, continuous purchases by treasury companies, and signs of sovereign buying, indicating that the impact of geopolitical shocks on Bitcoin is relatively short-lived.

This conflict has also sparked renewed attention in the market towards a certain country's local crypto infrastructure, especially the Bitcoin mining industry. According to estimates from 2021, about 4.5% of the global Bitcoin mining occurs in this country, primarily relying on low-priced government-subsidized electricity. During Bitcoin's upward cycles, this structure brings substantial profits.

After the military operation, there were rumors that some mining sites in the country were damaged, leading to a decline in network hash rate. However, short-term hash rate fluctuations are often more likely caused by block time differences or data noise, and there is currently no clear evidence indicating that this conflict has caused systemic damage to mining facilities. Another possible explanation is that the heat wave weather in the East Coast and Midwest has forced miners to temporarily reduce production.

In addition to infrastructure, this conflict has also sparked discussions about the role of cryptocurrency in the country's financial system. For a long time, the country's high inflation, international sanctions, and unstable exchange rate against the dollar have prompted widespread adoption of cryptocurrency in the private and gray economies.

Past data shows that during major political events and multiple conflicts in the country in 2024, there was a significant increase in the outflow of the country's crypto assets.

Bitcoin and a certain public chain have traditionally been the main blockchain networks used in the country, especially the latter for USDT stablecoin transfers. However, in this round of conflict, the on-chain stablecoin trading and settlement volume did not show a significant increase, indicating that the overall cryptocurrency usage pattern has not changed due to the outbreak of hostilities, and the on-chain activity of short-term holders has actually declined.

Although there were no significant anomalies in on-chain data, the cryptocurrency industry emerged symbolically during this conflict: the country's largest cryptocurrency exchange suffered a $90 million hack during the hostilities, with the attackers being an organization supporting the opposing side, leaving messages of opposition through wallet addresses. The exchange has previously been linked to the flow of funds from certain entities, and this attack seems more like a cyber psychological warfare rather than a profit-driven attack.

The country is one of the most severely affected by currency devaluation globally and has been subject to long-term sanctions. For such societies, crypto assets indeed play an important role in cross-border capital flows. The political and online dimensions exhibited in this round of conflict further indicate that crypto has become a part of the financial systems of certain countries.

Key variables in July will influence macro and market trends.

As we enter July 2025, the core focus of the market will be on several key events and macro indicators that could have a significant impact on asset pricing and the overall environment.

Trump signed a new bill on July 4th, which could significantly expand the already higher-than-expected fiscal deficit. According to the latest economic data, the U.S.