The best risk-on asset in the past decade, Bitcoin, is in a process of transition. Senior Commodity Strategist for Bloomberg Intelligence, Mike McGlone, said in a recent interview with Kitco News’ “On The Spot”. Related Reading | Arthur Hayes Says Ethereum (ETH) Could Reach $10K Level By The End Of Year This process is painful as crypto investors can confirm but could take the benchmark crypto to new highs. In the past 6 months, the price of Bitcoin dropped from an all-time high of $69,000 to its current levels of around $30,000. In the short term, the pain has been more pronounced with Bitcoin recording 9 consecutive weeks in the red. McGlone believes the cryptocurrency and other risk-on assets are responding to the current macro-economic outlook. The crypto market has experienced some of the best performance in global markets. The rally in the nascent asset class usually corresponds to 4 years cycles with parabolic bull runs followed by multi-year bear markets. Many in the sector believe cryptocurrencies entered their bear phase or the “Crypto Winter”. The losses have been compounded by two factors: the beginning of economic tightening measures by the U.S. Federal Reserve, and the collapse of the Terra ecosystem. In that sense, McGlone argued that Bitcoin and other cryptocurrencies must face the biggest losses as they recorded the largest gains. This process is called “Mean Reversion” when an asset trends in a direction...
