Analyst Says Bitcoin May Face Short-Term Challenges: This Concern is Shaking the Market! - Coin Bulletin

Bitcoin (BTC) may experience positive effects of a recession in the long term, but analysts warn that the cryptocurrency may face challenges in the short term.

The head of research at 10x Research, Markus Thielen, stated in a report dated April 11 that credit spreads continue to widen, indicating that concerns over a recession in the economy are deepening. Thielen said, "It is too early to create expectations of a bull market at this time."

Thielen stated that although the long-term effects of recession could be positive for Bitcoin, particularly after the Federal Reserve (FED) interest rate cuts leading to an expansion of the money supply, the price of Bitcoin could rise. However, he emphasized that in the short term, Bitcoin might experience a decline, and the subsequent recovery could take longer.

In the past, Thielen noted that economic weaknesses such as the FED's interest rate cuts or China's devaluation of its currency initially created selling pressure in Bitcoin, stating that this confirms the economic weakness.

Thielen stated that the price of Bitcoin is currently trading at around 80,620 dollars and expressed that the cryptocurrency may face more pressure in the short term.

In the short term, the strength of the dollar is weakening

In the markets, the US Dollar Index (DXY) has decreased by 2.92% in the last 5 days, standing at 100.337. This, along with the depreciation of the dollar, is raising investors' concerns about the strength of the dollar.

However, BlackRock's head of digital assets Robbie Mitchnick stated last month that Bitcoin could develop strongly in a recession environment. Mitchnick said, "I don't know if there will be a recession, but this could be a major catalyst for Bitcoin."