A large-scale breakdown in stock markets worldwide is not yet resolved for the year as a stagnant inflationary shock is already underway.
Bitcoin price went down some more in the outgoing week as political tensions across the globe were in focus as well as other associated weaknesses.
Is there the Possibility of a Great Depression in 2022?
Reports from crypto monitoring platforms show that the BTC to USD exchange is reaching its lowest point in more than a week following the return of volatility overnight. The BTC/USD pair was going to test the $38,000 support level at the time of putting this piece together, as three consecutive days’ losses were already approaching 12%.
Despite the fact that there isn’t trading going on officially, the trend table was in a decline for the world-leading cryptocurrency while the market mood on traditional stocks get wobbly with analysts.
Pundits Forecast
A market observer and commentator, Holger Zschaepitz, warns that global stocks have lost up to $2.9 trillion in market capitalization this week as the Russia-Ukraine war might be a trigger for a major stagnant inflationary shock.
He stated that economists are cutting down on their forecasts on growth and are raising inflation projections. Global stock markets are now worth about $110 trillion equal to a staggering 130% of the global Gross Domestic Product, and this looks way expensive for the current situation of things.
If a bigger Traditional Finance correction should set in, the already unstable crypto market might fare just as bad or worse, some analysts argue. A Twitter user is known simply as Pentoshi, who trades and analyses crypto assets, has gone as far as forecasting a repeat of the global economic meltdown that caused the Great Depression some 90 years ago.
Some other well-grounded pundits, nevertheless, are holding a relatively different opinion. In its most recent market outlook on cryptocurrencies published on the 4th of March, Bloomberg’s Intel maintained a bullish stance on Ethereum and Bitcoin.
The report read in part that most digital assets are now subject to the chipping waves in 2022, on the unavoidable reversion of the highest level of inflation to have occurred in forty years. This year might, however, make a new milestone for the leading cryptocurrency, Bitcoin.
It stated further that if perceived risk assets do not slide and reduce some of the pressure on its price, inflationary measures are very likely to maintain their buoyance, thereby leaving central banks few options other than raising interest rates aggressively.