Bitcoin is not an inflation hedging tool, but it performs better when the dollar weakens.

Odaily News According to Greg Cipolaro, head of research at NYDIG, inflation has no significant impact on Bitcoin prices, while a weakening dollar is more likely to drive the rise of Bitcoin and gold prices. He pointed out that although the market often views Bitcoin as “digital gold” or an inflation hedging asset, the data does not sufficiently support this view, as Bitcoin's correlation with inflation indicators is neither stable nor high. Cipolaro stated that Bitcoin has a negative correlation with the dollar index, a trend that is relatively new compared to gold but is gradually strengthening. It is expected that as Bitcoin further integrates into the traditional financial system, its reverse linkage with the dollar will become more evident. Additionally, he believes that interest rates and money supply are the main macro factors influencing the trends of Bitcoin and gold — generally, loose monetary policy and lower interest rates are favorable for Bitcoin price rises. He concluded that gold serves more as a “real interest rate hedging tool,” while Bitcoin has evolved into a “liquidity barometer” reflecting global liquidity conditions. (CoinTelegraph)