Renowned U.S. economist and Bitcoin advocate Lyn Alden recently shared her predictions for the upcoming period. Speaking in a YouTube interview with David Lin, Alden highlighted that the current market rally differs from that of 2021, especially in terms of liquidity. She stated, "People have shifted towards quality assets this time."
Alden believes that borrowing, geopolitical tensions, and monetary policies will significantly influence the markets in 2025. She pointed out that oil prices could be highly sensitive to potential crises, directly affecting inflation rates. Additionally, Alden emphasized the critical importance of the U.S. debt ceiling in the overall economic landscape.
"I'm Quite Optimistic About the Price"
During her discussion, Alden expressed optimism about Bitcoin's price. She noted that global liquidity conditions are beginning to improve, with China making progress behind the United States. "We are coming to the end of a prolonged period of credit restriction in the U.S., which will be beneficial for liquidity. Positive news from China also supports this outlook. In this sense, my interpretation is positive for Bitcoin. Bitcoin's price tends to correlate with liquidity, except during periods of exaggerated valuation. Therefore, I can say that I am quite optimistic about the price."
Differences Compared to the 2021 Rally
Alden observed that current conditions differ from those during the 2021 bull rally. She stated that investors are now gravitating towards quality assets. "Stocks, gold, and Bitcoin have risen together and fell together in 2022. Since then, there has been a recovery in liquidity. The S&P 500, gold, and Bitcoin have either reached new records or are very close to them. However, when you look at the ARKK ETF, it has not approached its peak level, despite being a technology-focused ETF. In the rallies of 2021, everything was at high levels. Why is this bull season different? Because liquidity is not increasing explosively like it did in 2021."
Conclusion
Alden's analysis suggests that improving liquidity conditions and a shift towards quality assets are key characteristics of the current market environment. Her optimism about Bitcoin's price is rooted in these factors, as well as positive developments from major economies like China. She advises that understanding these differences from previous market rallies is crucial for navigating the financial landscape in the coming years.
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