Many investors fear a US recession – but BlackRock sees this as a major opportunity for Bitcoin. Rising government spending and loose monetary policy could boost the cryptocurrency. So, is a new bull market on the horizon?
Concerns about a US recession are growing again, as several economic indicators point to a possible slowdown. The Federal Reserve‘s interest rates, weakening consumer demand, and ongoing geopolitical uncertainties are weighing on growth. Many experts expect the US economy could experience either a mild recession or a so-called “soft landing” in 2025 – a slowdown without a deep economic downturn. A key factor remains whether the Fed adjusts its monetary policy if the situation worsens.
“Looking at external forecasts, forecasters have generally raised the probability of a recession somewhat, but still at a relatively modest level. It has risen, but not by a large margin,” Fed Chairman Jerome Powell said during the press conference following the latest interest rate decision. Earlier, Mark Zandi, chief economist at Moody’s Analytics, told CNN: “Recession risks are uncomfortably high and continue to rise.”
Bitcoin Price Driver?
Although a recession is accompanied by economic uncertainty, it could offer both short-term and long-term growth opportunities for one asset class: Bitcoin. According to a surprising analysis by US asset manager BlackRock, a US recession could act as the ultimate price driver for what remains the largest cryptocurrency. During a recession, traditional asset classes such as stocks often lose value as companies struggle with declining profits, higher financing costs, and weakening demand. Investors may therefore increasingly seek alternative stores of value, with Bitcoin often viewed as “digital gold.”
Recession as a “Strong Catalyst”
Since Donald Trump was re-inaugurated as President of the United States on January 20 of this year, the Bitcoin price has plummeted by more than 17 percent (as of April 4, 2025). While a crypto rally was initially predicted thanks to Trump’s expected economic policy, the actual performance paints a different picture. Cryptocurrencies have been on a roller coaster ride since the beginning of the year. While Bitcoin reached an all-time high of around $109,115 in January, one coin recently cost around $83,060 (as of April 4, 2025).
Amid new tariff announcements and other turmoil, however, BlackRock recently surprised with its optimistic analysis. In an interview with Yahoo Finance, Robbie Mitchnick, Global Head of Digital Assets at BlackRock, predicted that a recession in the US could have a positive impact on Bitcoin: “The crypto market may have overestimated its expectations regarding the speed of deregulation and other catalysts.” At the same time, he also noted: “I don’t know whether we will see a recession or not, but a recession would be a strong catalyst for Bitcoin,” particularly given its safe-haven nature during crises. Bitcoin is scarce, decentralized, and independent, which makes it particularly attractive in times of economic crisis, the expert said. “Bitcoin has high liquidity, meaning it benefits from increased government spending, the accumulation of deficits, and lower interest rates—all typical features of a recessionary environment,” Mitchnick emphasized.
Mitchnick also noted to Yahoo Finance that many professional investors see the current market pullback as an opportunity: “Some of the most experienced Bitcoin accumulators we speak with are using this decline as a buying opportunity.”
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