•Bitcoin is likely to underperform the stock market on a risk-adjusted basis in 2024, while gold could come out on top, believes Mike McGlone, chief commodities strategist at Bloomberg.
•Despite bullish hopes following the recent approval of Bitcoin exchange-traded funds (ETFs) and the upcoming Bitcoin halving event, macroeconomic factors may prevent the largest cryptocurrency from reaching all-time highs in 2024.
•In particular, McGlone believes that market expectations that the US Federal Reserve will cut interest rates, which usually have a significant impact on risk assets like Bitcoin, are largely misplaced.
•“The Fed will not ease monetary policy as easily as it has in the past because of the inflation it has created through excessive easing,” McGlone explained.
•McGlone expects the US economy to enter a recession this year, which would push the stock market lower. Bitcoin is likely to suffer under these circumstances, as it is a leading indicator of risky assets. Pointing out that when the stock market declines, Bitcoin declines even more.
•According to the analyst, gold and Treasuries are likely to be the assets that will rebound in this economic environment.
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