Topic: How would a global economic recession affect Bitcoin's price? (Read 411 times)

I think we've had a recession or at least on most countries lately. A recession that followed the Covid-19 pandemic and the result was a slight bearish move that went to a few month and then a full move towards bulls followed. I guess this would be the same result to expect in any global recession as people would look out for alternative means to earn and cater for there daily needs.
This is some of the benefits the online platforms like Bitcoin/cryptos and the FX provides. Hence you'll have people tapping into this too and as well, the online gambling using cryptos.
Which ever way it goes, one thing is for sure and that is, bitcoin have got a huge role to play and it's sure to favour cryptos.

I hope your prediction comes true, otherwise the global economy would be destroyed for good. Everything will depend on how long the Russia-Ukraine war and the COVID-19 pandemic will last. The longer we're stuck with these, the longer it'll take for the world's economy to recover. While Bitcoin is not issued by any government or central bank, it depends entirely on Fiat to maintain its value.

If the mainstream economy is in a bad state, you can expect Bitcoin's market prices to go down the drain as people sell it to meet their needs. The same can happen vice-versa. 2024 marks another Bitcoin halving milestone, so it's likely the market will become bullish by then. We've already entered a global economic recession, so we can only hope for the best. Just my thoughts

Yes, Bitcoin will suffer a huge blow. People stay away from risky investments during a recession, and bitcoin is considered a risky asset by almost everyone. Demand will almost die, and maybe continuous dumping will cause a bear market with no brakes.

We would be lucky if it stays around 10k, if things go south 

Unfortunately, today Bitcoin correlates with tech-heavy stocks like the S&P 500 and the Nasdaq 100. If Covid 19, the Russia-Ukraine war and other global tensions continue, the stock market crash will accelerate. Unfortunately, Bitcoin will also get its share of this collapse...

The digital gold Bitcoin is a tech product, but not a tech-promising asset. People seem to have misunderstood Bitcoin. In fact, it should be accepted as a limited supply commodity (gold, silver, etc). But for now, things are not going that way. Therefore, if the global economic recession continues, the Bitcoin price will be negatively affected.

I think that in the mind of every speculator and investor that crypto has passed that event in their mind, and it is not bad, it is good to be prepared for different eventualities, however in the face of possible wars, and in the face of possible falls that have manifested in the USA and Europe where they have published that they are suffering the worst of all their inflations, if BTC has been ahead, the correlation is not exact, in the short term it is very minimal, but if it has a lot to do with investors, they immediately protect themselves with GOLD, but before anything, investors put everything in fiat money or hard currency, over time they will realize that BTC will turn out to be safer, but it is already a matter of the financial education that each investor has.

In my opinion, the current economic crisis will last another 1.5 years. 

Currently, we see an increase in inflationary processes in the US and Western Europe.  We have a recession and stagflation ahead of us.  The US Federal Reserve will gradually raise discount rates (refinancing rates) up to 4 percent.  This is the factor limiting Bitcoin's upside potential.  At the same time, after some time, the world economy will come to an equilibrium state. 

From 2024, a new period of economic growth will begin. 

I expect the price of Bitcoin to exceed $100,000 in 2024.

Bitcoin has performed terribly during the COVID crisis, but that doesn't mean it's the end of the world. I think the main issue here is that the world is still stuck with the Fiat standard. As long as people use Fiat as a unit of account (mainly USD), Bitcoin won't be going anywhere soon. By itself, Bitcoin is a stable cryptocurrency that's the ideal safe-haven asset for anyone, anywhere worldwide.

I'm hoping the day comes where people pay for things using Bitcoin directly instead of converting it to Fiat. For instance, you'd pay 0.0001 BTC for a cup of coffee without having to worry about how much its worth in terms of Fiat. If people did that, volatility would no longer become an issue. Some say the economic recession has already started, so expect further price drops until the world decides to abandon Fiat for good. Just my opinion

The market is so unpredictable - we have not even in our wildest dream have thought that the whole world will be shut down in Covid and so much losses to businesses will happen in a jiffy. After I have seen that horrible COVID battle I have lost most of my interests in the materials. And also I dont make much plans because during last 2 years none worked out well.

This is true, and I believe that it took USA about 150 years or more to reach the first 7 trillion printed if I remember it correctly, probably even more, then took them about 3-4 years to print the next 7 trillion dollars. That should be easy enough to see what US dollar means.

There isn't anything that could be considered at a good rate in the end. Which would be a deal where it could take a good amount of time to reach this place, but then it took very quick to repeat it. This is why I hope that the best thing would be slowing that down, because if they keep on printing like that again, then it would be super horrible and it would lose even more value.

I think "pretty well" understanding for dollar is not the same with you and me. I mean just because that money is in the banks for the high interest rates doesn't mean that it is a good thing. Think about it, a  lot of money is in interest, that means a lot of interest will be needed to be paid, and since recession the return will be very little and banks may fail to pay that back, at least not that high interest rates.

This will result with you getting to a point where it is not going to be a simple thing. Just wait for it, do not get hyped about it, and you could definitely reach to a point where things will be a lot better in the long run but right now dollar is horrible.

I believe most people agree that cryptocurrencies will grow relative to fiat currencies in the long term. As the debt bubble bursts, interest rates cannot fall below 0%, so central banks around the world begin printing money to provide liquidity to the market. This leads to higher inflation, with Crypto declining in value but not necessarily in value (versus gold for example), which will depend on Crypto widespread adoption and institutional investment.

A global economic recession will definitely affect the price of Bitcoin, because come to think of it, What is a recession? A recession is a period of time when there is a temporary economic decline, of which the economy is the driving force of all currencies, be it digital or physical, and Bitcoin is no difference, but thou it may be decentralized but it's price is influence by a simple economic theory of demand and supply. Which simply means, the higher the demand of a limited product will cause an increase in price, and when the the demand is low it was cause a decrease in price of a product, and a recession will definitely case a less demand for Bitcoin, because take a look at the current price of Bitcoin now, that is as a result of Russia and Ukraine crisis.

What the crypto market has now shown, in a situation of a protracted, really difficult, and really global crisis (Covid, war), confirms my assumption that bitcoin is not a "safe haven" and an attractive investment asset in times of crisis. You will say - "so, just recently, billions of dollars were poured into it! Many people got rich!..." Yes, it was, but in 2016-2018 there was no real global crisis. There were local pockets of problems, and there was cheap and affordable money. And then, even in the conditions of the cryptocurrency hype, speculation with cryptocurrency looked really attractive.
Now, when many countries do not know how to prepare for winter, others do not know where to buy grain and food now to meet domestic needs, and still others have lost millions of relatives (from illness, from war), they are investing in really demanded areas. These are food, oil and gas, alternative energy and the production of solar panels (the list is by no means exhaustive). But bitcoin has become useless to anyone ... Because it does not represent real value and significance for the real market. No, I even believe that it will cost 1 million dollars, but this is not now, not here, and maybe not bitcoin

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.

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.

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.

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.

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.

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

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 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.

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

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and last look at this US inflation chart

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

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.

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.

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.

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

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.

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.

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.

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

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.

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.

I don't see BTC as a safe haven in the sense that you purchased it when it was low, say 8k dollars and it eventually rises to a 100k, you make a transaction, the person on the other end pays you at the rate it is valued, but in a situation where it drops to say 99k, you run a loss.

It depends on your description of a global crisis and how to deal with it. Trying to compare Bitcoin with stocks is fundamentally flawed because of the real differences between the two originals, as is trying to compare it with gold.

If the crisis is related to liquidity or a real problem in the economy, you will find that many have moved away from high-risk investments, and therefore the value of Bitcoin will decrease.
But if it is related to a specific activity or crisis, we may witness the opposite.

best way to view it..

use the "bread loaf" value

imagine there was no bitcoin trade at all. no volatility due to people wanting bitcoin or not and bitcoin got pegged to a fixed value..
like a loaf of bread being $2 so the price at the moment is about 11,000 loaves of bread..

in 5-10 years imagine bread was $10
the fiat value of common things would be 5x more also.
meaning people would sell bitcoin for over $100k. just to stay at same value.

now add back in the inconsistencies of the market.
electric prices are going up. meaning miners costs are going up. this means they wont sell for less value than this years low
also those small hobby miners with higher residential electric wont mine. and instead they would buy, because its cheaper to buy coin right now compared to paying their electrical provider to mine bitcoin
so even more push up of the bitcoin market price.

then there are the FIAT bank savers. realising if they held onto $10k. they cn buy 5k loaves today but only 1k loaves of bread if they just kept their fiat as fiat. so they are in dire need to spend their fiat now on things they may want in 10 years time. because its cheaper to buy them now.
or they will invest their savings in a store of value that hedges against inflation if they dont have real world things to buy and instead want to safeguard their savings.... and yep, bitcoin springs to their mind.
so even more buyers. meaning more support for a price rise.

what you are seeing this month. is not an expectation of long term trends of a down action of bitcoin price.
what is happening is those that were considering to save up for a mortgage in 10 years or buy a car. are rushing now to do so now by converting their stored value to spend it all now. so that in 10 years time they are not having to have a price ticket of 5x if they waited to buy later.

right now. the temp holders/ the short term investors are exiting. but those that hold will reap the rewards for holding over the long term.

in short if you dont need to buy anything expensive in the next couple years hoard your coin. if you NEED to buy expensive things in the next year or so. spend your fiat now, get it while its cheap. because your fiat wont buy it all in a few years. it will cost you more fiat later

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.

The price is already been affected we see the market going down and up, the volatile erratic nature is becoming super normal right now. I do think that the most important thing is understanding the fact that market is not permanent so it would eventually become more stable with time.

Therefore I do understand the implications of the price decreasing with the recession but I do think we all just need to HODL and take advantage of the price at the moment , one can also combine it with trading and still earn.

With recessions ofcourse everything will go down.

To be fair, the job layoffs are mostly with high growth-focused tech companies in general, not necessarily exchange companies.

And apparently, Binance is still hiring despite the market turmoil. https://twitter.com/cz_binance/status/1537013824666095617

We already seeing that effect in the crypto space. Many exchangers are laying off their employees. With that said in the upcoming days things would be worst in terms of job placement. Job is the first thing which keeps everyone alive because that’s how we get paid and spend!

However, the price of bitcoin is different story. Prices would get affected if investors stop investing and users stop using the crypto currencies during the recession.

A global recession hits every market as it affects the spending capability of the community; This reduces how much money people have to put into different assets and usually slows demand and reduces the price.

To understand how this could affect Bitcoin, we can take a look at the 2020 crisis, where there was total and partial lockdown in most places, slowing economies to a halt, Bitcoin however maintained a fairly stable price and acted as a sort of hedge funds for most, while many other assets were going to the ground.

This of course, does not mean bitcoin is resistant to market crisis, the reaction would not always be the same.

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It's also important to note, that BTC has its market cycles, so drops and spikes are not always the result of any particular cause.

To stop inflation, the world bank stopped the circulation of money by stopping printing. but can't completely stop the money they've printed. When interest rate increases in the past have shown price volatility which has resulted in large withdrawals of money from exchange to fiat to meet standard interest costs.

Bitcoin is not the only one that will fall into a recession, but all investment assets traded on exchanges will experience a significant price depression. Inflation prevention in each country will run slowly, where the price hike in the market will also trigger a delay in the ups and downs of unstable prices.

The fear of an economic slowdown is what send all the risky assets crashing down this year, crypto currencies are part of these assets. A recession now would make exeything worse because economies would contract, leaving the consumers struggling even more. One the one side we have rising inflation which makes living expenses rise and on the other side we have worse outlooks for the  future. I would expect asset prices to drop future as investors are heading for save investment. The problem is that safe investment don't work during high inflation times, their return is not enough to cover the rise in prices. That's why I think we will see more demand crypto currencies the higher inflation rises. The independence of crypto currencies is what makes them protect us against inflation and losing value in fiat money.

1.The US dollar is doing pretty well in 2022. The war in Ukraine helped for the drop of the Euro, so the US dollar is actually stronger than before. The Federal Reserve increasing the interest rates might add more value to the US dollar.
2. Everyone is talking about recession, but the recession might not come. There might be a negative net economic growth, which means bigger inflation and lower economic growth. Stagflation is also an option, but we don't know if the Saudi Arabians won't decide to increase oil production. The disruption of the supply chains is something that creates problems right now, but the global economy will adapt and new supply chains will be created.
3. The Bitcoin price might go down or it might do up. Nobody knows what will happen so all the opinions here are mostly guessing and fantasizing. If the global economy starts growing with a faster temp, the Bitcoin price will go up. If there's recession/stagflation, the crypto winter will continue.

Stabilize again? Especially when talking about crypto in general (crypto was and is never a safe haven), since when did bitcoin and crypto stabilize in the first place? It was never stable in any timespan besides a few days up to a week.

Crypto market is different compared to stocks because people see it as a safe haven for their investment.

We have passed many economic problems already and yet the market is still here and it's still profitable to invest in.
remember when covid-19 was first announced? people panic and there's a problem with global economic but bitcoin soar and even achieve its new ATH.

Currently, the market is still very volatile and its movements are difficult to predict.
so we need to know that for now crypto is not a safe haven and may need to wait for the market to stabilize again,
but indeed we need to see it in the long term

You say it as if it will be a very different thing from what is there now, and it is not. A recession is defined as GDP falling two quarters in a row and we are on our way, we are not far off. So, recession will simply be the realization of what we are seeing.

Monetary policy, energy prices and inflation have already affected the price of Bitcoin. That the recession will be confirmed is not going to affect it much more.


I doubt very much that it will halt, and if that happens, the S&P will drop below 2,000 points, etc. It won't be bitcoin alone that will continue to go down and it would be a disaster. But I see that as unlikely.

Isn't it occurring as we talk?

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.

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.

When global recession come every market falls. because banks pull out money supplies to control inflations, interest rates rise and investments fall. This is a general trend. Now if a recession come it will be first for bitcoin. I believe during recession many companies layoff their best people. I believe such people will engage themselves in web 3.0, for money. There will be expansion of blockchain ecosystem, the bitcoin will surge and once again people who are critic will say its all imaginary, but bitcoin will go to moon.

However, the economic recession will certainly have an impact on all fields. Because the economic recession itself is closely related to an increase in the unemployment rate, a decrease in retail selling prices, to a slowdown in economic activity. And of course it can affect the bitcoin market. because the decline in people who invest will be felt when this economic recession lasts. so that people will spend more money to meet the needs of their daily life. and there will be little left for investment. even on a worse scale can make people no longer able to invest and even withdraw their investment. But that's if the real economic review occurs. and it can be said very close to the possibility of happening because the economic review itself is a period of weakening the economy that lasted for two consecutive quarters.

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?