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About This Episode
We’re back covering the DXY, Gold versus Bitcoin, interest rates, stagflation, Strategy, Metaplanet and Bitcoin dominance. Broadcasting from California, the PNW, Michigan and New York City: This is The Hurdle Rate for the week of April 21, 2025.
In This Episode
- DXY Breakdown
- Gold vs Bitcoin as the Hurdle Rate
- Interest rates and stagflation
- Strategy, Metaplanet, and Bitcoin dominance
Episode Summary
Key Themes: DXY weakness; Bitcoin vs. gold; institutional stress test; stagflation vs. deflation; Bitcoin dominance.
DXY Breakdown
Matt framed DXY as one of the most important macro charts he watches, arguing that the dollar has been in a long-term weakening trend for decades even if it remains the world’s reserve currency. He noted that recent sharp DXY weakness is meaningful but not unprecedented, and said prior dollar downtrends have often lined up with strong Bitcoin performance. His broader point was that a weak dollar does not mean immediate reserve-currency collapse, but it does strengthen the case for scarce store-of-value assets.
Bitcoin and Gold Are Benefiting From Dollar Weakness
The group agreed that as the dollar falls, investors increasingly look toward hard assets, especially gold and Bitcoin. Matt argued that a declining dollar is structurally bullish for Bitcoin, whether or not equities also perform well. Ben added that current price action is acting like a live stress test of the “Bitcoin as digital gold” thesis, especially when Bitcoin stays green on days risk assets are red.
Institutional Portfolios Are Not Built for This Environment
Matt said the current combination of a weak dollar, weak bonds, weak equities and strong Bitcoin/gold breaks the assumptions behind many pension and institutional portfolios. These portfolios were built around stock-bond diversification, and when both fall together while underfunded pensions are also sending out more cash than they receive, the stress becomes real. In theory, Bitcoin and gold should help, but most institutions are still not positioned for that.
Consultants and Boards Are Slow and Risk Averse
Tim asked whether consultants might push gold before Bitcoin, and Matt said that it’s likely because consultants tend to move toward consensus and away from career risk. Ben made a similar point about executives and boards: many understand something is wrong with fiat and treasury management, but few are yet willing to be early. Their view was that Bitcoin adoption will likely spread only after pressures become too obvious to ignore.
Bitcoin Has a Better Long-Term Setup Than Gold
Jeff emphasized that gold’s recent surge will eventually spur more mining and new supply, while Bitcoin’s supply remains fixed regardless of price. Ben said this hard-capped, inelastic supply is exactly what makes Bitcoin the stronger long-term answer to monetary debasement. At the same time, he argued Bitcoiners should not alienate gold holders, since gold bugs are already close to understanding the same core problem.
Heading Toward Stagflation or Deflation?
The conversation shifted to rates, AI and the macro outlook. Jeff raised the possibility of stagflation, with sticky prices and weakening employment, while Matt argued that over a longer horizon, AI may prove so deflationary that deflation becomes the bigger issue. Ben said that kind of deflation would be deeply disruptive because it would reverse the current incentives to spend, borrow and invest. The group generally agreed that policymakers would likely respond with more easing rather than tolerating prolonged pain.
Bitcoin Dominance Keeps Rising
On Bitcoin dominance, Jeff and Ben both argued the move higher reflects Bitcoin increasingly separating itself from altcoins as the one crypto asset that clearly solves a real problem. Ben called many altcoins “liabilities,” while Matt said there could still be short-term relief rallies elsewhere in crypto, but for serious corporate treasury adoption and long-term holding, Bitcoin is the only asset that really makes sense.
Main Takeaway: A weakening dollar is increasingly boosting store-of-value assets, exposing flaws in traditional portfolios and strengthening the case that Bitcoin is superior to gold as the long-term hedge over fiat and altcoins.