With the US economy slowing down, many see Bitcoin as the next massive protected haven, much like gold did in the 1930s. And with the continued decline in US economic data, many are speculating about how cryptocurrencies, especially Bitcoinwould react to this perfect storm.
Renowned analyst Michaël van de Poppe believes Bitcoin could follow the trajectory of gold’s historic price rise during the Great Depression.
As views on US debt, inflation and rising interest rates intensify, Bitcoin is increasingly being presented as a hedge against economic uncertainty. Van de Poppe is among analysts who believe Bitcoin will soon reach its final high and that it will be sustained by interest rate cuts and quantitative easing.
This #Bitcoin The shock wave is close
This is typical. The four-year cycle occurs just like any other cycle, but the significance of this cycle can be compared to the 1930s when Gold or https://t.co/GoodB359DI beating in 2000.
Influence $BTC will be huge in the next… photo: twitter.com/ZARsWX4qf8
— Michaël van de Poppe (@CryptoMichNL) September 5, 2024
Comparisons to the Gold Standard
The gold analogy isn’t that far-fetched. In the 1920s, gold was still on the gold standard, but when the economy went up in smoke in the 1930s, the precious metal soared. That may be exactly what’s happening with Bitcoin today. Van de Poppe insists that Bitcoin’s four-year cycle remains intact, just as gold has gone through a predictable series of cycles during economic turmoil.
BTC market cap currently at $1.07 trillion. Chart: TradingView.com
The global economic landscape is changing, with the US national debt topping $35 trillion and the Federal Reserve struggling to raise interest rates while trying not to continue to eliminate inflation. Most countries around the world, such as China, are withdrawing their portfolios from the US dollar. This could weaken the US dollar’s current grip on the world, pushing more investors towards alternative assets like Bitcoin.
Bitcoin: Is There a Breakthrough in the Bull Market?
But Van de Poppe isn’t the only one who’s super bullish on Bitcoin. According to him, US economy will be setting itself up for one last massive bull run well before the expected financial crisis. The Fed’s expected rate cuts later this month will be a last desperate attempt to keep the economy afloat. In fact, those cuts could actually cause Bitcoin to rise in value instead.
Image: IIFL Finance
Investors are hedging their bets on assets like gold and Bitcoin during these uncertain times. These assets have performed quite well during the economic crisis. In lithe of this thinking, Van de Poppe is expressing a growing trend of analysts who view Bitcoin as a up-to-date store of value.
The End of US Dollar Dominance
Perhaps one of the biggest factors driving interest in Bitcoin is the tender US dollar. With inflation and interest rates rising, holding cash is no longer as attractive. This seems to have translated into a change in how people and institutions hold their wallets. Van de Poppe also mentioned that other currencies, such as the Japanese yen and the euro, are gaining strength while the US dollar is showing weakness.
Featured image from Pexels, chart from TradingView
