Grayscale Research expects Bitcoin to reach its all-time high and other crypto assets to rise if the US economy avoids a recession.
Grayscale, an asset management firm, has forecasted positive growth for Bitcoin (BTC), Ethereum (ETH), and other cryptocurrencies driven by macroeconomic factors.
While assets saw a decline last month compared to first-quarter numbers, the company noted that a shift in bullish factors could stimulate market growth.
Grayscale remains optimistic about Bitcoin and other assets and has introduced new investment products.
Grayscale Backs Bitcoin and Ethereum Growth
In a recent market report, Grayscale Research identified the factors behind the decline in crypto assets while projecting an upward trend for Bitcoin.
According to the firm, Bitcoin could re-test its all-time high if the U.S. economy avoids a recession and stays on track for a soft landing.
Analysts highlighted macroeconomic factors and reiterated that users are turning to Bitcoin as a hedge against inflationary risks.
“At the same time, Grayscale Research believes that there is very little tolerance for a deep economic downturn, and is expecting policymakers to print and spend at the first sign of trouble. The undisciplined approach to monetary and fiscal policy is one reason why some investors choose to invest in Bitcoin; a period of economic weakness could therefore reinforce the longer-term Bitcoin investment thesis.”
Crypto assets experienced a slowdown at the beginning of August following a weaker-than-expected U.S. Employment report.
The company noted that the impact might not be as severe as in previous cycles due to shifts among U.S. politicians ahead of the elections.
Institutional Investors Change The Dynamics
This year, institutional investors have increased their presence in the market, boosting sentiment.
The launch of Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) spurred significant investments within the industry.
Several traditional firms also expanded their Bitcoin exposure.
Another key factor supporting the company’s outlook is the growing importance of crypto as an election issue, with candidates increasingly focusing on the sector.
Recently, crypto-related bills have also made progress in Congress as policy watchers continue to apply pressure.
