Bitcoin stays near record highs as weak US dollar drives new crypto demand

Dubai: Bitcoin’s back near record highs — but not without drama. From plunging after US airstrikes on Iran to a bounce driven by a falling dollar, the world’s most popular cryptocurrency is proving it's not just an investment — it’s a barometer for global fear and financial hope.

As markets swing between panic and profit, Bitcoin is again showing why it thrives when confidence in traditional systems fades. The largest cryptocurrency traded at around $107,400 on Friday, just below its record, despite slight intraday dips.

The US dollar has fallen to a three-year low, which is increasing demand for Bitcoin as a hedge against currency depreciation. With expectations of looser monetary policy from the US Federal Reserve and improving trade ties between the US and China, some investors are turning to digital assets as an alternative store of value.

"Bitcoin is showing resilience despite broader market jitters," said a market analyst. Many see the crypto asset as a hedge against financial instability, especially when fiat currencies like the US dollar lose value.

Ethereum, the second-largest cryptocurrency, was trading at $2,437, down 1.4%. The total crypto market cap dipped 0.7% to $3.28 trillion, according to CoinMarketCap.

Earlier in the week, Bitcoin fell below $100,000 and Ethereum dropped sharply following news that US bombers struck Iran’s nuclear sites. The announcement, made by President Donald Trump, triggered a wave of risk aversion in crypto markets.

"Markets are nervously watching developments in the Middle East," said Caroline Mauron of Orbit Markets. The strikes on Iran’s Fordow, Natanz, and Isfahan facilities triggered a global response and renewed focus on oil prices when traditional markets reopened.

Pantera Capital’s Cosmo Jiang added, “The overhang of whether the US would strike Iran caused a selloff through the week and into the weekend. But Bitcoin tends to lead the market out of a bounce when geopolitical risks rise.”

In the past 24 hours, over $1 billion worth of crypto positions were liquidated, with $915 million from long bets and $109 million from shorts, according to data from Coinglass. The high volatility is being amplified by a large Bitcoin options expiry event, expected to inject further price swings into the market.