Popular macro expert Lyn Alden warned investors. Next bitcoin (BTC) has signaled that the bull run may be far away.
In a recent strategy session with crypto analyst Benjamin Cowen, Alden said the Federal Reserve’s continued rate hikes are likely crypto- He said it would put downward pressure on his assets.
Will There Be a Bull Run?
“They are currently in a rate hike cycle, raising rates in a slowing economy. Because they see inflation as their primary concern. They think higher interest rates are a key way to contain this. So we see a dynamic similar to late 2018. That was the story of all 2022, this march towards weakness.
I think as long as you have that dynamic, it’s a tough place for Bitcoin and similar assets. That doesn’t mean you have to have new lows. It’s quite possible that we’ve seen the lowest levels. However, I don’t think it means that you will enter a new bull market anytime soon.”
Alden also FedHe assumes that hawkish policies will eventually succeed in reducing inflation. However, he states that it is possible that it will not work. If it doesn’t work, it could cause people to lose faith in the Fed’s policies. However, it may lead him to invest in alternative assets.
“Right now, whenever you see high inflation or a strong labor market, the market still assumes that the Fed has it in check, that if they get hawkish enough they can crush it, if they get tight enough they can cause this period of structural disinflation.
And I think that won’t be rewarded in the long run because inflation is largely financially driven, largely out of the Fed’s control. While rate hikes may somewhat suppress private sector inflation, they can worsen public sector inflation.
I think if the market realizes that at some point, basically if inflation continues to erupt and they’re already in a recession and we’re still in inflation, then there might be a shift and people will say, ‘Wait a second, maybe more rate hikes aren’t going to get inflation under control and maybe I think they will want to be less wealthy.”
Bitcoin is trading at $20,125 at the time of writing and has fallen 7.4% in the last 24 hours.
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