US recession would be a big catalyst for Bitcoin: BlackRock

US recession would be a big catalyst for Bitcoin: BlackRock

  • 20.03.2025 06:53
  • cointelegraph.com
  • Keywords: recession, bitcoin

Bitcoin is expected to thrive in a U.S. recession due to high fiscal spending and low interest rates, according to BlackRock. Despite concerns about risk-on assets, Bitcoin's narrative is often misunderstood, with sophisticated clients viewing market corrections as buying opportunities.

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BlackRock

BlackRock

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Analyst rating: Strong buy

BlackRock's expert predicts Bitcoin will thrive during a US recession.

Context

Business Insights and Market Implications

Business Insights

  • Bitcoin's Resilience: Bitcoin is expected to perform well during a potential U.S. recession due to its structure benefiting from high fiscal spending, low interest rates, and monetary stimulus.
  • Market Sentiment: Despite concerns about risk-on assets like stocks and high-yield bonds suffering during economic downturns, Bitcoin's narrative is often misunderstood.

Market Implications

  • Client Accumulation: BlackRock's sophisticated long-term clients view market corrections as buying opportunities, contrary to short-term pressures.
  • Price Movement: Bitcoin's price stands at $86,000, reflecting a 3.8% increase over the past 24 hours.

Competitive Dynamics

  • Narrative Misunderstanding: The text highlights a potential gap in market understanding of Bitcoin's performance during economic downturns, positioning it as an alternative to traditional risk-on assets.

Strategic Considerations

  • Monetary Policy Impact: Low interest rates and fiscal spending are seen as catalysts for Bitcoin's growth, aligning with broader macroeconomic trends.

Long-Term Effects

  • Potential Recession Catalyst: A U.S. recession could further solidify Bitcoin's role as a store of value and hedge against economic uncertainty, potentially altering market dynamics long-term.