A cold chill has settled over the cryptocurrency market, with the flagship digital asset Bitcoin (BTC) falling around 35% since January. As a result, many people are left wondering how deep into a crypto winter the market is and whether or not there are signs of spring.
Speaking with Kitco News, senior commodity strategist at Bloomberg Intelligence, Mike McGlone, opined that once this bear market in risk assets subsides and valuations recover again, cryptocurrencies are going to outperform all other asset classes.
Previously McGlone had stated that Bitcoin is on track to hit $100,000 by 2025, and when questioned over what gets investors out of the crypto winter and what needs to happen to spark a rally. The commodity strategist stated:
“I think what’s going to happen is the great reversion is just getting started. It might be like the aftermath of 1929, I think it’s gonna be like the, aftermath of 2008 maybe like after the 1987 crash it’s so overdue. The greatest inflation 40 years in most people’s lifetime is just starting.”
McGlone added:
“Once we kind of get through that period, I think Bitcoin is going to become realized that this is one of the best assets on the planet to hold. Now that’s my base case well how that works out I don’t know so I see my outlook is, I think some of the best assets to own will be gold U.S. long bonds and Bitcoin I think we’re going back to deflation.”
Bitcoin and the crypto winter
Indeed, with Bitcoin not responding to inflation and other macroeconomic factors as most proponents of the cryptocurrency anticipated to many, it is hurting the long-term case for Bitcoin.
“It’s just a matter of time it’s just the way it works but in terms of things I watch like commodities and assets they’re just in the early days of reverting and bitcoin should be one of the ones that come out ahead.”
He continued, “I think the best performing assets will revert to gold, U.S. long bonds and Bitcoin, I think will perform the best.”
Notably, the commodities specialist expects that the assets will all break out at some point in the near future.
For McGlone, the price of gold will break out once the markets see that long bond yields have peaked and the Fed’s hiking expectations have been put on hold, which he believes will with a lower stock market.
Only then gold and bond prices will revert, climbing upwards, and he anticipates the same for Bitcoin.
