Bitcoin vs. USD: Revealing Bitcoin’s Real Inflation‑Adjusted High in 2025

Key Takeaways:

Bitcoin and Gold: Both are seen as stores of value during inflation, but Bitcoin is easier to move and store.

Dollar Value: The U.S. dollar has lost about 40% of its purchasing power since 2005, based on long-term changes in the Consumer Price Index (CPI).

Inflation-Adjusted Bitcoin: Bitcoin hit over $73,000 in March 2024, but that was still below its 2021 value in nominal terms. It didn’t set a true high until November 2024.

Projecting a Real New High for Bitcoin: Bitcoin’s nominal all-time high of $109,640 on January 20, 2025, is the benchmark for evaluating future real highs after adjusting for inflation.
Under mild inflation (yoy +2.7%), the nominal price of Bitcoin would need to rise to over $110,652.4 by July or over $112,077 by year-end to match its prior real peak in inflation-adjusted terms.
Under higher inflation (yoy +4.2%), these thresholds are more demanding. The nominal price of Bitcoin would need to rise to over $112,268.5 by July or over $113,713.9 by year-end to match its prior real peak in inflation-adjusted terms.

Bitcoin vs Gold: A Look at Inflation Protection

Over the past two years, rising inflation has become a major concern around the world. As the cost of living goes up, many people look for ways to protect their money. Gold has been a traditional option for this purpose. But more recently, Bitcoin has gained attention as another possible choice.

The chart below shows the one-year price trends of Bitcoin and gold. Bitcoin rose much faster than gold during several periods, especially in early 2024. Although its price later dropped, the overall increase is still much larger than that of gold.

One reason people compare Bitcoin to gold is that both are limited in supply. But Bitcoin is easier to move and store. Because of that, some see it as a stronger tool for dealing with inflation in today’s economy.

The Dollar's Value Has Steadily Fallen

The Consumer Price Index (CPI) is one of the main tools used to track inflation in the U.S. It shows how much money is needed to buy the same group of goods and services over time. A higher CPI means it takes more dollars to make the same purchases, which signals that the dollar has lost value.

As shown in the chart below, the CPI has been rising for years. In January 2005, the index was 191.6. By January 2015, it had increased to 234.7, and by January 2025 it reached 319.1. This means that something costing $191.60 in 2005 would cost over $319 in 2025.

Put another way, 1 dollar in 2005 is only worth about 60 cents in 2025. In just 20 years, the dollar has lost around 40% of its purchasing power. This long-term effect shows how inflation steadily reduces what each dollar can buy.

Bitcoin Price in an Inflation-adjusted World

Bitcoin reached several record highs in recent years, but not all of them tell the same story once inflation is considered. Looking only at the dollar price may ignore how much the value of the dollar has changed over time. To make a fair comparison, we adjust Bitcoin’s Nominal Price using the Consumer Price Index (CPI).

Bitcoin's nominal price reached $73,098 on March 13, 2024, setting what looked like a new all-time high. But once inflation is taken into account, the picture changes.

To understand this, we use April 2021 as a benchmark. Back then, Bitcoin was priced at $63,576. Adjusted for inflation, that same $63,576 in 2021 is equal to $74,422 in March 2024 dollars. In other words, Bitcoin`s nominal price needed to rise above $74,422 in March 2024 to truly beat its 2021 value in real terms.

It didn’t. Even though the nominal price hit over $73,000, it still fell short of the inflation-adjusted threshold. This means the March 2024 peak, while impressive on paper, was not a record high when the weaker dollar is taken into account.

The table below shows this comparison clearly:

The chart beneath further illustrates this point. The red line shows Bitcoin’s market price, while the blue line reflects its CPI-adjusted value. For much of 2023 and early 2024, nominal prices remained just under the high set in 2021.

It wasn’t until Novermber 2024, when Bitcoin`s nominal price broke above $75458, that it finally surpassed previous peaks even after accounting for inflation.

Projecting a Real New High for Bitcoin

Bitcoin’s nominal all-time high was reached on January 20, 2025, when the nominal price peaked at $109,640. This figure serves as our benchmark for evaluating whether future nominal price movements can surpass this level in inflation-adjusted terms.

To assess this, we explore four scenarios based on when Bitcoin might reach a new nominal peak—either in July 2025 or December 2025—and under two inflation assumptions:

Mild inflation: CPI year-over-year growth of +2.7%, based on the average from Q1 2025.

Elevated inflation: CPI year-over-year growth of +4.2%, reflecting the post-COVID average and anticipating possible inflation pressures due to renewed tariff policies.

The detailed calculation results are shown in the table below.

These projections make clear that even if Bitcoin`s nominal price matches or slightly exceeds its January 2025 nominal high later in the year, it might still fall short of achieving a real new high after adjusting for inflation:

Under mild inflation (yoy +2.7%), the nominal price of Bitcoin would need to rise to over $110,652.4 by July or over $112,077 by year-end to match its prior real peak in inflation-adjusted terms.

Under higher inflation (yoy +4.2%), these thresholds are more demanding. The nominal price of Bitcoin would need to rise to over $112,268.5 by July or over $113,713.9 by year-end to match its prior real peak in inflation-adjusted terms.