Looking at macroeconomic conditions and possible Federal Reserve policies, Mike McGlone, chief commodity strategist at Bloomberg, believes that cryptocurrencies will outperform traditional assets in the coming year.
According to Daily Hodel, McGlone notes in his new analysis that in 2022, the market value of digital currencies has decreased by 1.3 trillion dollars as of early December, which is almost equivalent to the decrease in the total market value of Amazon and Google.
The strategist says that these figures show that Bitcoin and other digital currencies are still in the early stages of their growth.
Magalon added:
The strictest contractionary monetary policies of the Federal Reserve in the last 40 years are a good reason for creating a downward macroeconomic trend; But in 2023, it is likely to be about assets that will benefit from the central bank’s policy rotation. If they don’t move to ease austerity, the world could be heading sharply into recession, with ramifications for all risk assets. The basic situation in our economy is a long period of deflation, which will result in the growth of the digital currency market; As the Bloomberg Glassy Crepito index also confirms it.
The strategist says the dominance of stablecoins among the top five digital assets by market cap actually shows how valuable Ethereum is. He pointed out that this is the underlying technology of Ethereum, which enables fast and cheap transactions of these digital dollars.
Meglon said in the end:
Our bias is based on the principle that in the long term there will be few competitors that prevent this advanced technology from doing what futures markets and ETFs did. Other developments made possible by Ethereum include decentralized tokens and decentralized exchanges.
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