There is growing uncertainty in the market about the continuation of Bitcoin (BTC)’s bullish cycle. However, analyst Willy Wu argues that the next big bear market will not be determined by Bitcoin’s internal cycles such as halvings, but by the global economic cycle.
Bitcoin, which is trading at US$108,000 after hitting an all-time high of US$126,000 16 days ago, is facing a new paradigm, according to the paper.
According to Wu, the price of Bitcoin has historically fluctuated due to the overlap of two four-year cycles: the halving of issuance (halving) and central bank injections of global liquidity (M2). However, please consider the following The financial liquidity cycle remains the only major driver.
Wu warns: Future cyclical downturnSimilar to the 2001 and 2008 crises; It’s the ultimate test of your digital assets. A scenario of the deepest economic contraction Bitcoin has ever experienced will define its true nature.
of Main question Mr. Wu suggests that when faced with a crisis, Bitcoin will behave like a risk assetfell at the same level as tech stocks, Or whether it functions as a worthy haven.similar to gold.
Meanwhile, the performance of the market’s major digital assets continues to be closely linked to the expansion of monetary supply around the world, awaiting events that will test that narrative.
As CriptoNoticias points out, Woo is not alone in wondering whether Bitcoin is a haven asset or a risk asset (similar to technology stocks). This is because digital currencies are still in the early stages of adoption. Due to its characteristics, the “digital gold” narrative is very likely to become entrenched in the market and grow in popularity over time.