Bitcoin's descent to $40,000 is predicted by a commodity strategist, as stated here.
Warning Bells Ring as McGlone Warns Bitcoin Plunge to $40,000
Don't let the current bitcoin price above $100,000 fool you, as Bloomberg's senior commodity strategist Mike McGlone has sounded the alarm on a potential Bitcoin crash to $40,000. His bearish outlook is heavily influenced by broader economic trends and the possibility of a long-delayed recession.
In a recent X post on June 3, McGlone pointed to the risk of deflation and economic downturn affecting not just Bitcoin but all risk assets. With the Bitcoin-to-gold ratio peaking in May, McGlone suggests that it may have reached its top, especially if the U.S. equity markets begin to decline.
"Bitcoin $40,000, Gold $4,000; Inflation vs. Deflation, Recession - If deflation catches up, the languishing price of Bitcoin vs. gold in 2025 may reflect anticipation of a regular economic cycle where deflation follows inflation," McGlone stated.
If gold strengthens and Bitcoin weakens, the BTC-to-gold ratio could significantly narrow, potentially fueling a drop to $40,000 for Bitcoin - a sharp 62% decline from its current price of $105,387.
Investors may flock to gold as a safe haven if the economy contracts and the S&P 500 tumbles towards the 4,000 level. This scenario could result in gold prices surging to $4,000 an ounce, while the Bitcoin-to-gold ratio drops to around 10.
McGlone's previous remarks indicate that he has been keen on the relationship between Bitcoin and gold, especially during periods of market uncertainty. Gold's recent outperformance of the S&P 500, even with competition from Bitcoin, signals the early signs of a broader market correction.
With ongoing market volatility and trade tensions under President Donald Trump's administration, gold has reached record highs, while Bitcoin remains consolidated above $100,000.
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While McGlone's projection of Bitcoin dropping to $40,000 is part of a broader analysis examining gold's bullish outlook in a deflationary environment, it serves as a stark reminder for Bitcoin investors to brace for uncertainty.
Caution should be exercised by Bitcoin investors, as Mike McGlone's prediction of a potential Bitcoin price drop to $40,000 is backed by his analysis examining the risk of deflation and a possible economic downturn. If gold prices surge to $4,000 an ounce and the Bitcoin-to-gold ratio drops significantly, this could fuel a fall in Bitcoin's price, potentially to $40,000.
