As recession rumors swirl in the wake of the latest US economic growth numbers, digital asset management firm CoinShares revealed a bullish prognosis for Bitcoin in a tweet on Friday:
“Are you worried about how the cryptocurrency industry will evolve? When it comes to how the Bitcoin could behave in a recession, our research team agrees, and it’s not as terrible as you might imagine. »
CoinShares reports on a blog post in which it is claimed that the rising dollar, which has made Bitcoin particularly susceptible to rate hikes, is primarily responsible for the recent decline in the price.
CoinShares maintained that the United States and the rest of the world will experience a recession, which will prompt the Fed to begin to ease its measures, due to the combination of Fed rate hikes and the deterioration of the situation in the financial sector. the energy caused by the crisis in Ukraine.
Therefore, CoinShares believes that a dovish Fed and a weaker dollar will be supportive of Bitcoin, which is a rapidly expanding store of value and growth asset. According to CoinShares, this will likely put an end to Bitcoin’s erratic movements and lead to the end of its correlation with tech stocks.
United States: recession or not?
It is important to note that the American economy has shown signs of weakening even if the Fed refuses to announce that the first economic power is in recession due to the good unemployment figures. It was revealed last week that the US economy has contracted for the second consecutive quarter, one of the signs that a nation is in a recession.
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The Fed raised rates yet again last week by 75 basis points. The rate hike seems to have been priced in by the market, and cryptocurrencies reacted positively.
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