Benzinga - Bitcoin (CRYPTO: BTC) analyst Michael van de Poppe takes a bullish stance on the cryptocurrency as the Federal Reserve begins unwinding Treasury buybacks, signaling a potential shift in monetary policy.
What Happened: Van de Poppe took to social media platform X, to share his concerns. He pointed out that the FED’s decision to unwind Treasury buybacks and reduce QT is a response to worsening economic data, which increases the likelihood of a recession.
He suggested that this could become evident in the upcoming months and advised investors to consider long-term investments in Bitcoin.
He wrote, “Casually, the FED starts to unwind Treasury buybacks and is reducing QT. Why? Well, the economic data starts to become worse, which means the chances of a potential recession have increased. Likely this will pop up coming months in the data. Long #Bitcoin, QE is close.”
Casually, the FED starts to unwind Treasury buybacks and is reducing QT.Well, the economic data starts to become worse, which means the chances of a potential recession have increased.
Likely this will pop up coming months in the data.
Long #Bitcoin, QE is close.
— Michaël van de Poppe (@CryptoMichNL) May 2, 2024
Quantitative easing is a monetary policy used by central banks to increase liquidity in the financial system, typically by purchasing long-term government bonds from major banks. This is done to stimulate economic growth by encouraging banks to lend or invest more freely.
See Also: Bitcoin, Ethereum, Dogecoin Closing April With Heavy Losses, Slide Below $60K Causes Over $380M In Liquidations
Why It Matters: Van de Poppe’s warning comes at a time when the cryptocurrency market is experiencing significant fluctuations. On the same day, he had also projected a prolonged recovery period for Bitcoin while anticipating a surge in altcoin performance. His recent warning about a potential recession adds another layer of uncertainty to the market.
Meanwhile, other analysts have been sharing their views on Bitcoin’s future. DonAlt, a prominent cryptocurrency analyst, pointed out that despite bearish price action on lower time frames, the outlook remains bullish as long as Bitcoin closes above $60,000 on the weekly timeframe.
Meanwhile, Peter Schiff sees Bitcoin in a bear market despite the hype surrounding spot Bitcoin ETFs. He compared Bitcoin’s performance to gold and pointed out that Bitcoin's previous support level of $60,000 now acts as resistance.
On the other hand, Bitcoin is battling to reclaim some levels as Solana and meme coins lead the market rebound. This follows a period of losses earlier in the week, with Bitcoin open interest dropping to its lowest levels in two months.
Van de Poppe had earlier projected a prolonged recovery period for Bitcoin while anticipating a surge in altcoin performance.
Price Action: Bitcoin is presently trading at $59,009, marking a slight 0.10% decline over the last 24 hours. Nonetheless, it has surged by 33.59% since the beginning of the year, according to the data from Benzinga Pro.
Read Next: Is Bitcoin Heading For A Dip Ahead Of FOMC? Analyst Predicts Potential ‘Cascade Towards $55-58K’ Before Rebound
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