Degrossing Now, Bitcoin Moonshot Next? Here’s The Case, Says Analyst
Bitcoin is currently affected by forced deleveraging, but macro strategist Felix Jauvin believes this is a precursor to a significant trading opportunity once the market stabilizes. He emphasizes that Bitcoin's value is primarily driven by global liquidity rather than US equities. The US has a higher fiscal deficit relative to GDP than other countries, leading to increased inflation and nominal GDP, which benefits the S&P 500 and Bitcoin. Jauvin notes that the Trump administration's goal to reduce trade deficits could lead to decreased dollar flows to foreign nations, prompting foreign central banks to raise rates and strengthen their currencies. This shift may result in increased global liquidity moving away from the US, affecting the risk premium on US dollar assets. Jauvin anticipates that Bitcoin will eventually decouple from US tech stocks as non-US fiscal stimulus becomes a key liquidity source, positioning Bitcoin as a favorable asset in the post-deleveraging environment.
