Following the recent price drop that impacted all asset classes, Bloomberg Intelligence analyst Mike McGlone believes the top two cryptocurrencies by market cap will lead to the largest returns.
McGlone claims that the Federal Reserve’s interest rate hikes are more harmful to the US stock market in the long run than established digital currencies like Bitcoin (BTC) and Ethereum (ETH) in a recent interview with Yahoo Finance .
He says the important thing to remember is that if the stock market continues to fall, which is likely because the Fed wants it to fall in order to curb inflation, Bitcoin and Ethereum will also fall, but they will come out ahead.
In comparison to the stock market, the volatility of these emerging crypto assets, most notably Bitcoin, has continued to fall. That’s what happened when Amazon first launched. Its volatility in 2009 was comparable to that of Bitcoin now.
Cryptocurrencies, according to McGlone, are the next revolution, on par with Amazon and other market innovators and winners from the 2000s and 2010s.
He asks, do you really want to lose out on this revolution? Investors are looking forward to the future.
“That’s what I see happening. A little bit of selling offers in the stock market and bids below in things like Bitcoin and Ethereum.”
Bitcoin is up from its weekly lows of approximately $27,000 at the time of writing, after falling from above $36,000 a week ago. It’s currently worth $29,843 and is in the green by approximately 5%.
Not the only asset class in decline.
Despite BTC’s loss of the $30,000 mark, McGlone points out that it is not the only asset class in decline.
He says that “With any risk assets, it’s going down with the tide.” What happened this week to the S&P 500? For a brief period, it fell below 4,000. Both Bitcoin and the S&P 500 returned to their 100-week moving averages for the first time in nearly two years.
As the Fed hammers the punch bowl, the asset that has risen the greatest in the last five to ten years will return. It has a better chance of succeeding.
Ethereum is roaring back as well, having regained the $2,000 mark after dipping to $1,824 on Wednesday With a trading price of $2,047, ETH is up 6.83 percent.
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