Bitcoin fell below $19k after the US announced its latest GDP data. The country officially entered a recessionary phase. A recession is defined as an economic downturn and a decline in GDP for at least two consecutive quarters. The price rebounded and markets did not react as expected. This could be because the data arrived as expected.
Officially, the US is in recession
The US is officially in recession if we only look at it technicalally. We saw a 0.6% decrease in growth in Q2 GDP data compared to Q1. Although many in the White House claimed that the US economy was still in good condition and they aren’t in recession, we saw a 0.6% decline in growth compared to Q1.
Before you panic about your investments or the economy, I want to share what a recession means for the US. The Kobeissi Letter is a financial commentary resource that discusses the situation. It stated that every healthy economy will experience multiple recessions. If this doesn’t happen, then we can say the economy is in an economic bubble. For the US, both are in a recession and a bubble.
Even though the current situation is dire, it’s good for the future. It’s not just America, Europe is in the same situation with high inflation and crazy energy price rises.
What does this mean for the cryptocurrency market?
Bitcoin fell below $19k after the Q2 GDP data were announced, and the US was officially declared in recession. It made a lot over $18.1k. The price has returned to $19k since then, which is a positive sign. The announcement didn’t cause market panic, so the bottom may be in. Altcoins have also held their ground, and haven’t changed much over the past 24 hours.
If we go into a recession, markets will shrink. But, rather than see it as a negative, I view it as an opportunity.
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