A few key indicators of the strength of the U.S. economy appear to be pessimistic, signaling new opportunities for individuals and businesses in the U.S. to invest in Bitcoin. Indeed, large companies are getting involved in this trend.
Nic Puckrin, an analyst and founder of The Coin Bureau, shared his observations on the current situation.
Could a U.S. economic recession be beneficial for Bitcoin?
Recently, it seems that concerns about a U.S. economic recession have been alleviated. The Atlanta Federal Reserve has released a positive GDP report, and the threat of tariffs has significantly decreased.
However, two important measures of the current U.S. economic situation are pessimistic, signaling trouble for the dollar and potential opportunities for Bitcoin.
Specifically, these two indicators are the OECD Economic Outlook and the ADP Employment Report. According to the Employment Report, hiring in the private sector is at its lowest level in over two years, prompting President Trump to pressure Jerome Powell to lower interest rates.
On the other hand, the OECD has even provided a gloomier forecast. The organization predicts that U.S. GDP growth will decline from 2.8% in 2024 to 1.6% in 2025 and then continue to decrease in 2026.
A recession occurs when there are two or more consecutive quarters of declining growth, so two years could be disastrous. Global GDP growth rates are low, but those of the U.S. are even lower. The OECD also predicts that inflation will be asymmetrically high.
U.S. GDP forecast | Source: OECD
Moreover, a series of new tariffs on the EU and technology sanctions against China could exacerbate the brewing crisis. Nothing is certain, but there are many indicators of potential recession currently affecting the market.
Nic Puckrin described the situation in the U.S. and explained how it could benefit Bitcoin:
"The OECD has just released figures about one of the biggest fears of investors regarding the U.S. – the country's growth prospects, which they now predict will be the bleakest in the next two years. If the U.S. dollar still clings to hopes of a previous recovery, the OECD's alarming report has finally sounded the death knell," Puckrin said.
Puckrin continues to provide a few other statistics, such as the U.S. dollar index (DXY) declining 9.3% year-to-date and continuing to fall. Morgan Stanley predicts a further decline of 9% in the coming year.
Bitcoin has long been a potential recession hedge and investors outside the U.S. have turned to it. Along with that, these trends explain why U.S. companies are making similar choices. Most importantly, BTC has recently been less volatile than usual, prompting U.S. corporations to make significant investments.
Corporate whales like Strategy are making new commitments, and the massive ETF capital flow presents a clear picture. Just yesterday, JPMorgan even launched a new service to facilitate institutional clients' access to cryptocurrency. These discrete data points lead to a single conclusion.
"Companies are rushing to bolster their treasuries with Bitcoin. As the U.S. dollar continues to depreciate, we will see this shift happen more and more as investors scramble to protect their assets. With Bitcoin holding above $100,000 for 20 days and still ongoing, it is rapidly becoming the new safe haven," Puckrin added.
However, as Russia has recently demonstrated, Bitcoin investments by U.S. corporations do not necessarily benefit everyday users or the DeFi ecosystem.
However, increasing demand will support the value of BTC, ensuring higher profits for current holders. As the recession may be approaching, savvy investors have the opportunity to secure stability and long-term growth.
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