Bitcoin Resilience suggests bullish outlook as dollars weaken, Stagflation Looms – Grayscale
Bitcoin investors may not be exactly this, but the BTC was a pretty good stakes as President Trump’s tariff plans last week resulted in historical losses in traditional markets. While stocks and other major investments have fallen from a cliff since the announcement of “release Day” April 2, Bitcoin has remained relatively stable loss of “only” 8% of its value.
“I think this is the most bullish 8% drawdown I’ve seen in Bitcoin,” said Zach Pandl, head of research in Grayscale, a leading crypto investment manager.
Based on historical data, you expect Bitcoin to have three times NASDAQ volatility, Pandl said. And while the Nasdaq dropped 15% at the beginning of the trading on April 8 (compared to April 2), Bitcoin was nowhere near 45% down.
In other words, an 8% denial is a positive because historical patterns are predicted a distant steeper to fall.
“I think crypto investors should be very pleased with the moderate pullback in Bitcoin,” Pandl, a former analyst at Goldman Sachs, said in CoinDesk.
“It reflects that targets-while these are a short term risk-off event for markets-perhaps something that supports Bitcoin’s adoption in longer running. I think the relatively modest drawdown reflects,” he added.
Pandl is bullish in Bitcoin in an environment where the dollar potentially loses its place as a global currency reserve.
“Stagflation will be negative for stocks and bonds, and, in history, which has been positive for the lack of goods.
Pandl said Bitcoin’s relatively good performance reflects a rotation away from large tech tech stocks towards Commodity assets such as Bitcoin. You can see this in Bitcoin’s performance against Roundhill “Magnificent 7 ETF.” You can now buy more of that ETF with a bitcoin Compared to a week ago.
With subscribing to the long-term thesis of Bitcoin investment as a safe shelter at uncertain times, the last days became a case of testing in which Bitcoin won. In theory, say these advocates, Bitcoin should benefit because investors seek dollars in dollars in times of fatigue.
“If you believe that the dollar position is part of the thesis of Bitcoin, then your conviction of that thesis in the last week should go up,” Pandl said.
He expects bitcoin prices to rise to medium-term, reaching new hours high this year.
“The price of Bitcoin has dropped but convincing is rising and there is no need to change the view of the medium term price,” he said.
