Bitcoin outlook positive as investors see buying opportunity, potential hedge against inflation and debt crisis

From Nasdaq Corporation
April 11, 2025 8:00:00 am:

Bitcoin started 2025 on shaky ground, influenced by speculation on Fed interest rate cuts, ending the first quarter in the red. Trump’s executive order to establish a U.S. Bitcoin reserve using seized assets didn’t impress investors. Market volatility due to Trump trade tensions led to a 25% pullback from Bitcoin’s $109,000 high in 2024.

Despite the recent downturn, many investors see Bitcoin as a buying opportunity. Fed Chair Powell likened Bitcoin to digital gold, while investor Ray Dalio recommended investing in assets like gold and Bitcoin to hedge against a potential debt crisis. Bitcoin’s resilience during market turmoil contrasts with the S&P 500 ETF Trust’s recent losses.

Bitcoin is often seen as a hedge against inflation due to its limited supply, unlike fiat currencies that central banks can print limitlessly. With Trump’s tariff policies likely to drive global inflation, Bitcoin’s value could thrive in an inflationary environment. Institutional and corporate adoption, like MicroStrategy and GameStop accumulating Bitcoin, are strengthening the market’s buying pressure.

Fed Chair Powell’s cautious stance on rate cuts may change if the U.S. economy slows due to trade tensions, possibly leading to quicker rate reductions. Lower rates typically benefit risk-on assets like Bitcoin. The technical analysis shows bullish signs for Bitcoin, with a 50-day moving average above the 200-day moving average, indicating a long-term uptrend.

Despite short-term uncertainties, Bitcoin’s technical setup, corporate adoption trends, and inflation-hedging characteristics suggest a favorable entry point. Market conditions, institutional adoption, and macroeconomic factors all point towards a positive outlook for Bitcoin.

Read more at Nasdaq: Q2 Bitcoin ETF Outlook: Is It a Safer Exposure?