Traditional Financial Institutions Changing Their Views on Bitcoin as a Bubble
According to macroeconomics expert Lyn Alden, traditional financial institutions are starting to shift their perception of Bitcoin (BTC) and no longer see it as a classic bubble. In an interview with Peter McCormack on the What Bitcoin Did podcast, Alden explains that the price of Bitcoin over the past 15 years has displayed an overall upward market trend, indicating its potential for continued growth.
Bitcoin’s Recurring Cycle of Higher Highs and Higher Lows
Alden highlights that Bitcoin has experienced a recurring cycle in which it has achieved higher highs after significant drawdowns of 75% or more, sometimes even exceeding 90%. She notes that while there are a few stocks that have shown similar patterns, none have done so more than three times. If Bitcoin achieves another higher high, it would mark the fourth time it has followed this cycle.
However, Alden acknowledges that most people are only aware of the market cycles they witnessed while Bitcoin was already prominent. For instance, they saw the spike and crash in 2017, followed by the spike and crash in 2021. This limited perspective leads many to believe that Bitcoin is prone to bubbles and subsequent demise.
Institutions Recognizing Bitcoin’s Long-Term Uptrend
Alden emphasizes that once institutions take note of Bitcoin’s historical pattern of higher highs and higher lows, they begin to realize that it is not simply a market bubble but an asset with long-term growth potential. The more these institutions witness repeated instances of this cycle, the more normalized and accepted Bitcoin becomes among them.
Bitcoin’s Current Price
At the time of writing, Bitcoin is trading at $42,742, showing a slight increase in the past 24 hours.
Hot Take: Traditional Financial Institutions Shifting Their Perspective on Bitcoin
Macroeconomics expert Lyn Alden highlights that traditional financial institutions are starting to view Bitcoin differently, recognizing that it is not a classic bubble. Bitcoin’s recurring cycle of higher highs and higher lows over the past 15 years indicates a long-term uptrend. While many people only witnessed the spikes and crashes during Bitcoin’s prominence, institutions are paying attention to its historical performance. As they observe more instances of this cycle, Bitcoin becomes more normalized and accepted among them as an asset with growth potential.
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