Bloomberg Intelligence’s senior macro strategist believes risky assets like stocks must crash before Bitcoin (BTC) bounces back to life.
In a new interview with crypto trader Scott Melker, Mike McGlone says Bitcoin is unlikely to take off as long as the US Federal Reserve shuts down the money printer.
“This is what I think is the indication of the poor performance – if you look at the overlay of Bitcoin vs [the Nasdaq]tends to outperform when the liquidity pump is on, and generally underperforms when the liquidity pump is off.
Relevant history is more relevant because it is such a young asset, and the point is that the liquidity pump is clearly not working, and is still a long way off. I’ve just looked at the futures on Fed funds – they’re up around 5% within a year. That does not give any hope of getting this liquidity pump going.”
McGlone too tells are 59,800 followers on social media platform X that the Federal Reserve will reverse its aggressive stance if the stock market collapses.
“There is a potential lose-lose here. The Fed is unlikely to add liquidity any time soon due to persistent inflation data. A key catalyst to bring about a turnaround could be a turnaround in what has helped prices this year: the resilient stock market.”
The Bloomberg Analyst highlights that Bitcoin has risen 26,000x in 12 years and that BTC would still be one of the best performing assets even if it loses more than 63% of its current value.
“A return to $10,000 would still maintain Bitcoin’s unprecedented performance.”
At the time of writing, Bitcoin is worth $27,711 and is up over 6% in the past 24 hours.
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