- Bloomberg strategist Mike McGlone believes that the inflation pressure will turn out to be in favor of Bitcoin.
- For the time being, Bitcoin has slipped under its crucial support with the escalation in the Russia-Ukraine crisis.
Ever since hitting its all-time high of $69,000 in November 2021, the world’s largest cryptocurrency Bitcoin (BTC) has been moving sideways. The BTC price has been under pressure for a while amid growing geopolitical tensions between Russia-Ukraine and tightening Fed measures.
Bloomberg’s senior commodity strategist Mike McGlone, however, makes an interesting prediction for BTC. Earlier on Sunday, February 20, McGlone tweeted that Bitcoin can face major headwinds in the short term. He further explains that inflation won’t recede unless the risk assets drop which hasn’t happened so far.
But McGlone believes that although the short-term outlook seems bleak, the benchmark crypto is on the path to set a new trend. Also, referring to the Fed’s financial tightening policy, McGlone said that a majority of the assets respond to “ebbing tide” in 2022.
But as inflation grasps firmly, McGlone believes that Bitcoin can hit a major milestone in 2022. In his Twitter post last Sunday, the Bloomberg analyst writes:
Bitcoin indicating a rough week ahead – Inflation Unlikely to Drop Unless Risk Assets Do: Most assets are subject to the ebbing tide in 2022, on the inevitable reversion of the greatest inflation measures in four decades, but this year may mark another milestone for Bitcoin.
#Bitcoin indicating a rough week ahead – Inflation Unlikely to Drop Unless Risk Assets Do:
Most assets are subject to the ebbing tide in 2022, on the inevitable reversion of the greatest inflation measures in four decades, but this year may mark another milestone for Bitcoin. pic.twitter.com/drnXyYea4F— Mike McGlone (@mikemcglone11) February 20, 2022
Previously, McGlone stated that Bitcoin has been showing divergent strength in comparison to the equities. In Bloomberg’s Crypto Market Outlook for February, the team has predicted a $100,000 target for BTC in 2022. Apart from Bitcoin, McGlone also remains bullish on Ethereum (ETH) and stablecoins aka “crypto dollars”.
Bitcoin slides under $37,000 amid Russia-Ukraine crisis
The geopolitical situation with respect to the Russia-Ukraine war has intensified further. A few hours back, Russian President Vladimir Putin has signed a decree announcing the eastern Ukrainian states as independent.
The matter has escalated on a global stage with Russia drawing sharp criticism from the west. Probably, the NATO allies will be announcing more sanctions on Russia ahead of this weak.
Read More: Does the invasion of Ukraine by Russia have anything to do with crypto? Here’s market analysts’ take
The direct impact of this news has been on the global equity markets and the crypto market. The broader cryptocurrency market lost over $100 billion of investors’ wealth with Bitcoin crashing under its crucial support of $37,000.
As of press time, Bitcoin is trading 6.02 percent down at $36,845 with a market cap of $698 billion. With today’s drop, Bitcoin has extended its weekly loss to more than 15% wiping out all its February gains. Along with Bitcoin altcoins have entered an even deeper correction with the top ten altcoins losing 7-15 percent.
On the other hand, risk-off asset Gold has shot up today owing to the growing probability of the Russia-Ukraine war. The MCX Gold is at a nine-month high currently trading at $1908 per oz.
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