The head of digital assets at a prominent firm believes Bitcoin is likely to prosper in a recessionary macroeconomic climate, which contrasts with views held by some analysts.
“Whether or not a recession occurs is uncertain, but it could serve as a significant catalyst for Bitcoin,” he shared during a March 19 discussion with Yahoo Finance.
He noted that aspects like increased government spending, rising deficits, lower interest rates, and monetary relaxation, typically manifest in recessive periods, act as drivers for Bitcoin (BTC).
“Additionally, it is somewhat driven by concerns over potential social unrest,” he added. “Regrettably, that too is something that can arise during a recession.”
🚨 LATEST: The Global Head of Digital Assets states, “If you analyze Bitcoin on a fundamental long-term basis, it appears to be an asset that should be uncorrelated or potentially inversely correlated with certain existing risk factors.” pic.twitter.com/bC0zKqF3xB
— Cointelegraph (@Cointelegraph) March 19, 2025
The executive remarked that the market is “not particularly well attuned” to Bitcoin, as many individuals still perceive it as a risk-on asset.
Risk-on assets, including stocks, commodities, and high-yield bonds, generally struggle during economic downturns, yet he expressed in September that Bitcoin is often mischaracterized.
“This is where the chance for education arises within a market and an asset class that is still developing.”
He mentioned that his firm has been assisting several clients in navigating these conflicting narratives.
Some of the firm’s more “advanced long-term Bitcoin accumulating” clients see the market pullback as an opportunity to buy and are undeterred by the prevailing economic challenges.
On the other hand, researchers from a cryptocurrency exchange expressed a less optimistic outlook, indicating that the previously positive expectations for the first quarter had “clearly been misguided” due to recession fears and recently imposed tariffs.
“Concerns over a significant economic slowdown or potential recession in the US have led to a drastic shift in sentiment,” the institutional segment stated in its monthly outlook on March 17.
Related: Major risks for the crypto market in 2025: US recession, circular crypto economy
The firm has played a pivotal role in fostering Bitcoin’s acceptance among institutions and wealth advisors through its Bitcoin Trust ETF, which has accumulated the largest assets of any Bitcoin investment product, amounting to $48.7 billion.
He is not concerned about the recent mass outflows from most spot Bitcoin exchange-traded funds, noting that it primarily stems from hedge funds unwinding the spot futures arbitrage trade rather than from long-term buy-and-hold players.
Currently, Bitcoin is trading at $86,000, reflecting a 3.8% increase over the past 24 hours.
Magazine: Meet lawyer Max Burwick — ‘The ambulance chaser of crypto’