Summary ⚈ McGlone warns a crypto crash could signal looming economic turmoil and deflation. ⚈ Market indicators point to fragility, with Bitcoin’s strength crucial to broader stability. ⚈ Analysts fear a 2025 recession driven by trade tariffs and tightening liquidity. Bloomberg Senior Commodity Strategist Mike McGlone has asserted that a cryptocurrency crash could signal looming economic turmoil and a deflationary period unlike any in recent history. Drawing on historical parallels like the 1929 United States stock market crash , Japan’s 1989 bubble, and the early 2000s Dot-com bubble , McGlone suggested that the crypto market’s current fragility might be an early indicator of deeper systemic issues, he said in an X on April 26. McGlone pointed to the 200-day moving average ( MA ) of the U.S. Treasury 10-year yield, which is now on the verge of turning lower after reaching its highest levels in nearly two decades. Cryptos have stalled vs. beta may lead deflation. Source: Bloomberg Intelligence “If cryptos break down, it might be a canary in the coal mine for deflation worthy of the inflation on the back of the biggest money pump in history,” he said. Reversing gains Regarding the current market’s fragility, specifically Bitcoin’s ( BTC ) unique role, he cautioned that the asset’s historic rally, which began in 2009 as the stock market bottomed, could now be reversing. When a highly speculative risk asset has to go up, what's the risk? Bitcoin began trading in 2009 when the stock market bottomed, but that historic run could be reverting. Now there's 14-million cryptos noted on CoinMarketCap, most of which depend on Bitcoin to go up for… pic.twitter.com/ZsCLvddijx — Mike McGlone (@mikemcglone11) April 26, 2025 Adding to concerns is the explosive growth in the number of cryptocurrencies, many of which rely heavily on Bitcoin’s strength for survival. Furthermore, he noted that the massive liquidity injections during the pandemic years created one of the largest money pumps in history, inflating asset prices across the board. Thus, a crash in crypto markets could be the first sign that the era of easy money is over, potentially triggering a sharp asset deflation and broader market turmoil. The strategist’s caution comes at a unique moment when cryptocurrencies seek to hit new highs after largely remaining in a consolidated state amid the tariff-induced downturn. Indeed, as signs emerged that the United States might be reaching a deal with China, Bitcoin, alongside stocks, traded higher, with the maiden digital currency surpassing the $90,000 mark. As of press time, BTC was trading at $94,089 with modest losses of less than 0.1% over the last 24 hours, while on the weekly chart, BTC is up over 11%. Bitcoin seven-day price chart. Source: Finbold Nevertheless, analysts remain concerned about a possible market downturn , warning of a potential recession in 2025 driven by uncertainty from the trade tariffs. Featured image via Shutterstock The post Why crypto crash could be the ‘canary in the coal mine’ for economy appeared first on Finbold .
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