Bitcoin hits a historic high, what is the market hot topic of "currency devaluation trading"?

Bitcoin reached a historic new high yesterday (5th), leading to the term “Debasement Trade” sweeping across the crypto community. What exactly is “Debasement Trade”? Why has it sparked heated discussions among global investors? (Background summary: After reaching a new high, Bitcoin encountered resistance again. Is this bull run approaching a “major peak”?) (Background information: Bitcoin continues to write a new historical high, analysts predict: BTC will soar to $150,000, and pullbacks are excellent buying opportunities.) With Bitcoin breaking through the $125,000 mark yesterday (5th) and setting a historic new high, the crypto community has also been flooded with a professional term in recent days: the keyword “Debasement Trade” rapidly climbed to the trending list, and it is being discussed everywhere from crypto media to social platforms. So, what exactly is “Debasement Trade”? Why is it so closely related to the surge in Bitcoin? Meaning of Debasement Trade In the context of financial investment, “Debasement Trade” usually refers to strategies adopted by investors to counteract the decline in the value of fiat currency. When central banks continue to print money, run massive deficit policies, or lower interest rates to stimulate economic vitality, the purchasing power of the currency is often eroded. At this point, investors will turn to hoarding assets that have scarcity or anti-inflation characteristics, such as gold, real estate, or Bitcoin, to protect their wealth from the effects of currency debasement. This strategy is called “Debasement Trade” because it aims to resist the risk of “value reduction” (Debasement) of fiat currency. JPMorgan Report: Bitcoin and Gold's Hedging Roles The recent trend linking “Debasement Trade” with Bitcoin comes from a report by JPMorgan. The report points out that when fiat currency begins to depreciate due to government deficits, inflationary pressures, or geopolitical risks, Bitcoin and gold have proven to be reliable hedging assets. JPMorgan analysts emphasize that Bitcoin's digital scarcity (totaling 21 million coins), transparent blockchain ledger, and anti-inflation characteristics make it an ideal choice to combat currency debasement. Thus, in the current context of the crypto community, “Debasement Trade” refers to hoarding assets like Bitcoin, which have a hard supply limit. Keyword for 2026: Currency Debasement Against this background, Bitwise's Chief Investment Officer Matt Hougan has also further predicted the trend of currency debasement, stating that “Debasement” will become the keyword for 2026. His argument is simple and straightforward: as the Fed continues to lower interest rates in a persistent deficit environment, the unwritten rules in traditional finance will be broken. Cash and bonds are no longer safe havens, and investors must seek harder assets to protect their wealth. Hougan believes that Bitcoin and gold, as the two pillars of “Debasement Trade,” are attracting the attention of both retail and institutional investors. JPMorgan Forecast: Bitcoin Price Targeting $165,000 In the report, JPMorgan further predicts that the price of Bitcoin is expected to reach $165,000 by the end of the year based on “Debasement Trade.” This prediction compares Bitcoin and gold using a “mechanical” model, with JPMorgan analysts noting that Bitcoin, as an ideal investment target for “Debasement Trade,” is currently still undervalued compared to gold. According to the current market capitalization of Bitcoin at $2.3 trillion, the price of Bitcoin needs to rise about 42% to match the market size of private investments in gold. Therefore, this means that the theoretical price of Bitcoin can reach $165,000. Additionally, the report highlights that by the end of 2024, Bitcoin is overvalued by $36,000 compared to gold, while currently, it is undervalued by about $46,000. Overall, 2025 is seen as a key node for the paradigm shift in asset allocation. If global central banks further lower interest rates and government deficits remain unrestrained, the demand for “Debasement Hedging Trades” may continue to heat up, and the status of gold and Bitcoin may become even more solid. JPMorgan's report has also clearly revealed: Bitcoin is no longer just a synonym for speculation, but is becoming a structural hedging tool alongside gold. Related Reports Bitcoin Hits New High of $125,800: Shorting Whales Rush to Supplement Margin, BTC Open Contracts Break $90 Billion for the First Time Bitcoin Surges to $125,800, Creating a New Historic High! Weekly Increase Over 14% The Era of Stablecoins Has Arrived; Is Bitcoin's Dream of Becoming a “Global Currency” Still Possible? <What is the “Debasement Trade” that is hotly debated in the market after Bitcoin sets a new high?> This article was first published in BlockTempo, the most influential blockchain news media.