Imminent Catalyst Could Trigger Bitcoin and Crypto Crash, Bloomberg Analyst Mike McGlone Warns

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Bloomberg Intelligences senior macro strategist Mike McGlone is wary of crypto assets amid a deteriorating economic climate.

McGlone says in a new report that cryptos, outperforming other assets, could crash if deflation sets in. According to Bloomberg Intelligence’s Senior Macro Strategist, deflationary risks are rising.

It’s been a year of rebounds for just about everything that fell in 2022, with cryptos leading among high beta performers, but a deflationary fall could gain fuel as seen in falling commodities and bank deposits.

Bloomberg Intelligence’s senior macro strategist says crypto assets are exposed to downside risks if the broader stock market falls, much like bank stocks have done in the recent past.

Bitcoin, born out of the 2008 financial crisis, is facing its first US recession, and if the broad stock market follows the banks, cryptos are likely to ebb with the tide.

At key levels to watch for Bitcoin (BTC) and Ethereum (ETH), McGlone says,

Leading indicators, technologies and breakthrough assets traded 24/7, Bitcoin and Ethereum could hit a wall of resistance at the key levels of $30,000 and $2,000.

Our bias is long-term bullish for top cryptos, but overwhelming stock market strength down with Fed tightening in a recession has the potential to lower the tide for all risky assets, and Bitcoin and Ethereum are among the riskiest.

Bitcoin and Ethereum are trading at $29,286 and $1,913 respectively at the time of writing.

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