Bloomberg Intelligence macro strategist Mike McGlone said Monday that the collapse in crypto prices could signal greater financial stress, warning that bitcoin could return toward $10,000 and potentially foreshadow the next U.S. recession.
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After climbing back to $70,841 at 07:00 UTC on February 15, from $65,395 late in the morning on February 12, bitcoin was hovering around $68,800 by mid-morning. The broader crypto market was also in the red on Monday, with 85 of the top 100 tokens posting losses. Privacy-focused coins monero and zcash are down 10% and 8%, respectively, over the past 24 hours.
“A healthy correction is what we should soon hear from stock analysts (who face unemployment if they’re not on board), following the crypto collapse,” McGlone wrote. “The mantra of buying on dips since 2008 may be over.”
McGlone highlighted several macro indicators that reflect elevated risk conditions. U.S. stock market capitalization relative to gross domestic product (GDP) has reached its highest level in about a century, he noted. At the same time, 180-day volatility for the S&P 500 and Nasdaq 100 is at its lowest level in about eight years, McGlone added.
He also described the “crypto bubble” as “imploding,” adding that “Trump euphoria” has reached fever pitch and is contributing to contagion in the markets. Meanwhile, gold and silver are “grabbing alpha” at a pace not seen about half a century ago, with increasing volatility that he says could “feed through” to stocks.
McGlone shared a chart comparing bitcoin divided by 10 for scaling, with the S&P 500. As of February 13, both were hovering below 7,000 on his chart. He said “volatile and beta-dependent” bitcoin is unlikely to stay above that level if the broader beta of stocks weakens.
The Bloomberg analyst identified 5,600 on the S&P 500, which equates to around $56,000 for bitcoin on his scale, as the initial “normal reversion” level. Beyond that, part of his base case scenario calls for bitcoin to return to $10,000, depending on a spike in the U.S. stock market.
McGlone’s outlook divides opinion
Jason Fernandes, co-founder of AdLunam and market analyst, told CoinDesk that McGlone’s thesis assumes that market extremes must resolve into a collapse and that the beta of Bitcoin stocks guarantees a proportional crash.
“It’s false equivalence and single-path bias,” Fernandes said. “Markets can also resolve excesses over time as inflation rotates or erodes. A macroeconomic slowdown could mean a consolidation or reset to $40,000 to $50,000, not a systemic pullback to $10,000.”
Fernandes added that a move toward $10,000 would likely require a truly systemic event, including a sharp contraction in liquidity, a widening of credit spreads, forced deleveraging among funds and a disorderly exit from stocks.
“This implies recession and financial stress, not just slowing growth,” he said. “Absent a credit shock or policy error that drains global liquidity, this type of collapse remains a low probability tail risk. »
