This One Catalyst Could Cause Speed For Bitcoin

Recent reports suggest that there is one key factor that could contribute to a fast recovery for Bitcoin.

However, Bloomberg Intelligence’s senior macro strategist, Mike McGlone, cautions that Bitcoin (BTC) may encounter significant challenges before the end of 2023.

McGlone said the fact that Bitcoin’s recent stagnation at the $30,000 price point may be an indication of upcoming unfavorable economic conditions.

“Yes, Bitcoin matters – if it stalls, there may be a bigger issue. Stalling at about $30,000 amid hype about potential for an ETF (exchange-traded fund) launch and the seemingly unstoppable stock market, a Bitcoin pause may signal bigger economic issues.”

According to McGlone, Bitcoin has increased by 100% from its low point in 2022. However, it is expected that Bitcoin may experience a price drop before it can achieve further gains.

McGlone also points out that the Nasdaq 100 Stock Index (NDX), which has historically moved in a similar way to Bitcoin, is currently outperforming the leading cryptocurrency.

This indicates a weakness in BTC. He further predicts that in the second half of the year, Bitcoin’s value will decrease due to deflationary pressures.

Deflation is a period when prices of goods and services decline, resulting in job losses and poor investment returns.

“Up about 100% from the 2022 low to around $30,000 on July 19 is a good bounce for Bitcoin, but another 2x advance might require a similar foundation – a significant decline,” he said.

He also explained the fact that: “Our graphic shows a problem: the risk-asset rally in 2023 hasn’t been endorsed recently by the asset some view as the fastest course in the race. After climbing about 5% since the end of 1Q, vs. closer to 20% for the Nasdaq 100 Stock Index, trailing Bitcoin may catch up or portend headwinds from a potential deflationary economic storm. Our bias is the latter.”

Regarding Bitcoin’s price today, at the moment of writing this article, BTC is trading in the green and the king coin is priced at $27,759.

In order to learn more details about this, check out the original article posted by the Daily Hodl.