President Trump is pressuring the Federal Reserve to cut interest rates significantly, which could lead to higher inflation, a weakened dollar, and instability in bond markets. The current economic backdrop indicates core PCE inflation at 2.8% and a 10-year Treasury yield at 4.33%. If rates are cut, inflation may exceed 4% by 2026, potentially dragging the dollar down further. Conversely, if the Fed maintains rates, inflation can still increase due to tariffs and the newly passed Big Beautiful Bill, which could raise core PCE inflation to 3.0–3.2%. In both scenarios, Bitcoin is positioned to benefit — either as an inflation hedge in a rapid-cut environment or as a store of value as the dollar erodes. With economic pressures on the rise, investor appeal for non-sovereign assets like Bitcoin is expected to solidify, making it a key player amidst the looming inflationary path.

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