How would a global economic recession affect Bitcoin's price?

[KingsDen]

Re: How would a global economic recession affect Bitcoin's price?

Bitcoin has a good advantage over other types of currencies largely due to its nature of not being affected by inflation. Since bitcoin is inflation proof, it is expected that it should flourish amidst inflation. But most times it has refused to follow as expected. There are so many factors that contributes to that;
Bitcoin doesn't work in isolation, it doesn't exist in a different world. It is humans that buys and sells bitcoin just like other currencies. If inflation hits the economy, people will have nothing much to invest or save. Majority people will be feeding from table to mouth. By this no one talks about Bitcoin or investing in it. Meanwhile many people doesn't believe in bitcoin to the extent of trusting it. So global economic situations still affect bitcoin, but not as impactful as it will be to fiat.

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[arwin100]

There have been talks among experts of a global economic recession taking place soon. The COVID-19 pandemic, the persisting Russia-Ukraine crisis, and several other factors will lead us there faster than you could imagine. Considering that the US Dollar is the world's reserve currency, anything that affects its value (inflation) will have a chain effect over other countries' economies as well. Now this could have profound effects over Bitcoin's price within the short term, as the crypto market "mimics" equity/stocks market's behavior. It's most probably Bitcoin will decline well below $10k, as the global economy comes to a halt. Or things could head in the other direction, leading Bitcoin towards new All-time-highs. The pioneer cryptocurrency has often been hailed as a "safe haven", so it should be able to serve as an alternative to Fiat during times of crisis.

What are your thoughts?

On the contrary, bitcoin should flourish during a global recession. It doesn't matter whether bitcoin will be considered as a safe heaven or not, but the falling value of fiat currencies may drive up the price if the demand stays strong. But a recession is unpredictable so anything can happen in reality. But if I have to speculate, I will bet on positive outcome for crypto during a global recession.

If all people in the world are open up on crypto and they see this as more quality currency to accumulate in times of recession then most provably we can see positive things on it in terms of crisis. But if people are still afraid because of its high volatility also people doesn't trust it maybe we can see this one fail and dump the same with some other fiat currency.

If we talk about safe haven maybe it will take a long time for bitcoin to reached at this point.

[Abiky]

Whatever happens, plan yourself on how long you're willing to stay holding bitcoin. Long term is still the best decision while holding it just to avoid being worried with the current world events.

Also, there's the China-Taiwan tension and that's also something that we don't want to happen and sure the economy of most countries ties to the both of it will definitely be affected too.

Only the strongest will be able to "hodl" Bitcoin long-term. I usually "hodl" BTC no matter what. But not everyone has the guts to do it. When prices are falling at a fast pace, the first thing that comes into mind is to sell BTC to avoid losing all your money in an instant. This usually happens when you don't have the extra money to spare into Bitcoin. Imagine how negative the effects over Bitcoin's price will be once we enter a global economic recession. Most people will be so scared of investing into Bitcoin, that they will prefer Gold instead. There's also the issue of China's (likely) invasion of Taiwan, which could be a severe blow to both the world's economy and Bitcoin's price. I would proceed with caution until the mainstream economy shows signs of recovery. Just my thoughts

[jossiel]

Whatever happens, plan yourself on how long you're willing to stay holding bitcoin. Long term is still the best decision while holding it just to avoid being worried with the current world events.

Also, there's the China-Taiwan tension and that's also something that we don't want to happen and sure the economy of most countries ties to the both of it will definitely be affected too.

Only the strongest will be able to "hodl" Bitcoin long-term. I usually "hodl" BTC no matter what. But not everyone has the guts to do it. When prices are falling at a fast pace, the first thing that comes into mind is to sell BTC to avoid losing all your money in an instant. This usually happens when you don't have the extra money to spare into Bitcoin. Imagine how negative the effects over Bitcoin's price will be once we enter a global economic recession. Most people will be so scared of investing into Bitcoin, that they will prefer Gold instead. There's also the issue of China's (likely) invasion of Taiwan, which could be a severe blow to both the world's economy and Bitcoin's price. I would proceed with caution until the mainstream economy shows signs of recovery. Just my thoughts

Yes, I've witnessed people that have said they'll be holding for long but it didn't happen and they have to dump it because of some circumstances that they have faced in real life.

Any war can trigger economic down fall, it's like a domino effect and even we're not entirely related to the two countries that are in quarrel, there will surely be a heavy blow worldwide.

[Kadal Ijo]

Global Economic Recession certainly makes many difficult things and the fastest impact is that investors will sell cryptocurrencies, although profit opportunities are very high but investors really need cash for many needs and when recession occurs, automatically makes the market red automatically.

[Jemzx00]

Global Economic Recession certainly makes many difficult things and the fastest impact is that investors will sell cryptocurrencies, although profit opportunities are very high but investors really need cash for many needs and when recession occurs, automatically makes the market red automatically.

Some crypto investors might probably sell or convert their cryptocurrencies into fiat to have cash in hand in this situation where recession occurs. However, things might be different to other investors who decided to convert crypto to fiat not because they need cash but rather they need to cut loss or
to put a stop on their trading activities to avoid future loses.
Also, there will be investors who will decide to hold as this recession might ignite or probably goes in a different direction for cryptocurrencies such as bitcoin which the OP stated.

[Desscount]

Global Economic Recession certainly makes many difficult things and the fastest impact is that investors will sell cryptocurrencies, although profit opportunities are very high but investors really need cash for many needs and when recession occurs, automatically makes the market red automatically.

The current global economic condition is really not doing well and seeing conditions like this is certainly not an easy thing either.
not only the crypto market but other markets will also turn red due to the recession,
hope the global economy returns to normal and this will take time

[Zilon]

Some crypto investors might probably sell or convert their cryptocurrencies into fiat to have cash in hand in this situation where recession occurs. However, things might be different to other investors who decided to convert crypto to fiat not because they need cash but rather they need to cut loss or
to put a stop on their trading activities to avoid future loses.
Also, there will be investors who will decide to hold as this recession might ignite or probably goes in a different direction for cryptocurrencies such as bitcoin which the OP stated.

There is high panicking around the crypto industry. Converting crypto to fiat is becoming a norm as price of digital assets keeps devaluating . Global Economic Recession has also contributed to the rate at which investors convert their crypto to fiats due to high inflation. Traders who converts their crypto to fiat are somehow contributing to the panic as the supply is gaining more grounds making the resistance zone form series of lower highs.

[Pomogator]

If this really happens, then all the countries of the world will abruptly begin to unite in small groups and create their own common currencies. I can assume that the digital yuan or bitcoin can easily replace the dollar. Nobody can predict exactly.

[yhiaali3]

Certainly, inflation and global recession will have a significant impact on Bitcoin and the crypto market in general, so according to my opinion, Bitcoin will temporarily drop, perhaps to below $14,000 as a result of being affected by the global economic situation, and then the second stage comes when people begin to realize that they are losing their money as a result of inflation and that Bitcoin is better ” store of value. Therefore, they will buy bitcoin a lot to preserve the value of their money from being affected by inflation, then we will see the bitcoin rise again to new peaks and unprecedented levels, the opportunity is available at the present time to buy more bitcoin at each drop and then hold.

[Abiky]

Certainly, inflation and global recession will have a significant impact on Bitcoin and the crypto market in general, so according to my opinion, Bitcoin will temporarily drop, perhaps to below $14,000 as a result of being affected by the global economic situation, and then the second stage comes when people begin to realize that they are losing their money as a result of inflation and that Bitcoin is better ” store of value. Therefore, they will buy bitcoin a lot to preserve the value of their money from being affected by inflation, then we will see the bitcoin rise again to new peaks and unprecedented levels, the opportunity is available at the present time to buy more bitcoin at each drop and then hold.

The global economy is in a very bad state now, so most people will have no choice but to sell their BTC in order to satisfy their needs. Only those who can afford to lose money, will buy BTC no matter what. You can bet that once the recession is over, Bitcoin and other cryptocurrencies will rise back to their former glory. Maybe BTC market prices will rebound all the way to $75k and above? No one knows what will happen as crypto is widely unpredictable.

I'm not worried about BTC seeing another bloodbath in price, as long as it works as intended. Fiat is going to collapse anyways, so relying on Bitcoin as a currency instead of an investment is the way to go. Who knows if the world transitions from the Fiat standard to the Bitcoin standard in the not-so-distant future? Just my thoughts

[dansus021]

Some crypto investors might probably sell or convert their cryptocurrencies into fiat to have cash in hand in this situation where recession occurs. However, things might be different to other investors who decided to convert crypto to fiat not because they need cash but rather they need to cut loss or
to put a stop on their trading activities to avoid future loses.
Also, there will be investors who will decide to hold as this recession might ignite or probably goes in a different direction for cryptocurrencies such as bitcoin which the OP stated.

Not just stop there there is also people who withdraw their money from stablecoin to direct fiat. and don't forget about LUNA crash the recent about Celcius that pending withdraw grow multiple concern about crypto world

and last look at this US inflation chart

[Gyfts]

The pioneer cryptocurrency has often been hailed as a "safe haven", so it should be able to serve as an alternative to Fiat during times of crisis.

In terms of market movement — it could potentially be a safe haven in the future when the market matures more, but most probably not a good save haven in the next few years for the reasons you've mentioned.

I doubt it. If institutional investors are involved in Bitcoin, they'll view the crypto market akin to the stock or housing market and pull out their funds if they see the market taking a downturn. Unless Bitcoin reaches stability through mass adoption, Bitcoin will move in tandem with other markets. If the global economy crashes, every market tanks too -- crypto no exception.

[stadus]

I heard it many times again, the global economy might struggle but bitcoin will always surprise us in a positive way.
What will happen is, if the stocks are dropping, investors who believe in crypto will put their money as it's not directly related to the global economy, and I will not even be surprise if that time we will again see a new bull run.

[GelatikKembar]

I heard it many times again, the global economy might struggle but bitcoin will always surprise us in a positive way.
What will happen is, if the stocks are dropping, investors who believe in crypto will put their money as it's not directly related to the global economy, and I will not even be surprise if that time we will again see a new bull run.

When the global economy is experiencing difficulties I think it has an indirect effect on the crypto market,
like at this time the global economy which can be said is not doing well and with problems that occur such as inflation and so on of course this makes us worry,
to be more clear, just keep following the progress

[naira]

I heard it many times again, the global economy might struggle but bitcoin will always surprise us in a positive way.
What will happen is, if the stocks are dropping, investors who believe in crypto will put their money as it's not directly related to the global economy, and I will not even be surprise if that time we will again see a new bull run.

I feel like any institutional investor who has alliances with other companies sees Bitcoin as a hotbed of business, not strictly as an act of adoption to grow Bitcoin. In general, it might be said that way, but the essence is that institutional investors will leave the bear market just like that if they start to be exposed to financial liquidity.

Basically, the global economy is triggered when inflation is not contained and the resistance begins to penetrate every point of the economy, even the microeconomic sector feels this way. Bitcoin is still fixated on the level of financial circulation and when we see interest rates rising, it puts both stock and crypto market prices under threat. For a while investors will withdraw, and after a certain amount of time buying Bitcoin at low prices makes them more and more in control of the market.

[kryptqnick]

Honestly, I've been waiting for a recession for a couple of years now, and maybe we'll just ease into it eventually with all that's going on (btw, war, not crisis, when it comes to Russia and Ukraine). In that case, I don't think Bitcoin will notice the difference. Or, maybe, it's already happening, and we're already seeing the negative impact on the price. In any case, I think that Bitcoin bear market is a matter of a few months, normally, while a global economic crisis can take much longer to recover from and no sudden rapid positive movement that can happen with Bitcoin. I'm judging here largely on how Bitcoin price reacted to the pandemic.

[2stout]

Bitcoin is a true global/universal currency and by this virtue, it will be affected by global events.  Market panic seems to be transcendent, just look at the stock market and crypto markets and you will panic selling isn't limited to either.  Unofficially, IMHO, the global economic recession has already begun.

[vv181]

~Now this could have profound effects over Bitcoin's price within the short term, as the crypto market "mimics" equity/stocks market's behavior. It's most probably Bitcoin will decline well below $10k, as the global economy comes to a halt. Or things could head in the other direction, leading Bitcoin towards new All-time-highs. The pioneer cryptocurrency has often been hailed as a "safe haven", so it should be able to serve as an alternative to Fiat during times of crisis.

There are a time when the bitcoin price correlation with equity/stocks are high and also when it inversed. Currently, it is very likely that when the recession begins, I don't think bitcoin will have its own way instead it will mimic every other else. The idea of save haven has been idealized by some people, but as of now, we haven't seen any of it since I believe the market hasn't been mature yet.

[teosanru]

There have been talks among experts of a global economic recession taking place soon. The COVID-19 pandemic, the persisting Russia-Ukraine crisis, and several other factors will lead us there faster than you could imagine. Considering that the US Dollar is the world's reserve currency, anything that affects its value (inflation) will have a chain effect over other countries' economies as well. Now this could have profound effects over Bitcoin's price within the short term, as the crypto market "mimics" equity/stocks market's behavior. It's most probably Bitcoin will decline well below $10k, as the global economy comes to a halt. Or things could head in the other direction, leading Bitcoin towards new All-time-highs. The pioneer cryptocurrency has often been hailed as a "safe haven", so it should be able to serve as an alternative to Fiat during times of crisis.

What are your thoughts?

It can affect bitcoin in both the ways. I feel if there is a recession in the equity markets generally the crypto market gets boosted as this signifies distrust among people on equity markets. However on the other hand many times it has happened especially in Covid times that Bitcoin's fall is exactly linear to the fall of equity markets like it happened in March 2020, equity markets around the world were at all time low and so was bitcoin. So either of the two things can happen in Bitcoin.