Analyst Warns Investors About Crypto Assets Amid Worsening Economic Climate By Benzinga
Benzinga – Earlier this week, macro strategist Mike McGlone warned investors that cryptos, which are outperforming other assets, could plummet if deflation sets in.
In a tweet on Wednesday, McGlone said he remains cautious about crypto assets amid a worsening economic climate.
The strategist wrote that “a deflationary bust may be gaining fuel as seen in plunging commodities and bank deposits.”
He added that crypto assets could face downward risks if the broad stock market falls.
Cryptos Could Be the Next Assets to Drop in Deflation Dominoes – It’s been a year of rebounds for just about everything that fell in 2022, with #cryptos tops among high-beta performers, but a deflationary bust may be gaining fuel as seen in plunging #commodities and bank deposits pic.twitter.com/H871jqA5xc
— Mike McGlone (@mikemcglone11) May 3, 2023
“Bitcoin, born of the 2008 financial crisis, is facing its first U.S. recession, and if the broad stock market follows banks, cryptos are likely to ebb with the tide,” McGlone wrote.
Also Read: Here’s Why This Analyst Says A $10T Market Cap For Bitcoin Can Happen
#Bitcoin Holding $30,000 Ceiling May Help Fuel #Gold Above $2,000 – Crypto enthusiasts who refer to gold as “boomer rocks” may fall by the wayside vs. the metal as the US leans into a recession. Optimism that there will be a soft landing and that the worst is over… pic.twitter.com/Kn3LiEzSlG
— Mike McGlone (@mikemcglone11) May 4, 2023
“The up-and-coming 24/7 traded leading indicators, revolutionary technologies and assets – Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) – may be running into a wall of resistance at the key round number levels of $30,000 and $2,000,” he added.
At the time of writing, Bitcoin was trading at $28,611, three percent down in the last seven days.
Meanwhile, CoinShares chief strategy officer Meltem Demirors said earlier this week that the U.S. banking crisis was the leading cause behind Bitcoin’s price action in recent months.
In an interview with Bloomberg Television, Demirors said there were two catalysts that have given Bitcoin a boost. First, investors are regaining an appetite for risk and, second, they are anticipating next year’s halving event in April when miners’ rewards are cut in half, she said.
Now Read: Analyst Who Predicted May 2021 Crypto Crash Now Says Bitcoin Set To Surge To This Price By 2024
Photo: Shutterstock
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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