While most analysts expect the crypto bull cycle to last until the end of 2025, concerns over the US economic recession, along with crypto’s “circular” economy, can still threaten crypto valuations.
Despite recent market corrections, most crypto analysts expect the bull cycle to peak from the third quarter of 2025, with Bitcoin (BTC) price forecasts ranging from $160,000 to over $180,000.
Beyond external concerns such as potential recessions in the world’s largest economy, the biggest industry-specific risk for crypto is the “circulation” nature of the economy, according to Arthur Breitman, co-founder of Tezos.
“Within the industry, the main risk is that the industry is still looking for a foundation,” Brightman told Cointelegraph.
“For example, the point of finance is to fund something (…), but if the only thing in finance is more of an obligation, then it’s a cycle,” Brightman said.
“The only reason people want to buy your token is because they feel like they want to buy this token. That’s a cycle.”
https://www.youtube.com/watch?v=xzvpxfbdf4
This is in stark contrast to the stock market “built on profitable businesses” and has become one of the major industry threats in the crypto industry, Brightman added.
Other industry insiders have criticised the crypto economy state that is particularly relevant to the latest Memecoin Meltdowns, which sucks up liquidity from more established cryptocurrencies.
Solana Outflows. Source: Debridge, Binance Research
Solana was hit by more than $485 million in February after a recent wave of Memecoin Rug Pull caused investor flights “safe” and poured into BNB chain Memecoin, such as the Broccoli Memecoin, inspired by Changpeng Zhao’s dogs.
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The fear of the US recession is the biggest external risk of code: Tezos co-founder
Beyond industry-specific events, greater macroeconomic concerns, including the possibility of a US recession, threaten traditional and cryptocurrency markets.
“When it comes to macro events, I think we can still see the recession,” Brightman said.
“There are a lot of bullish winds in the market, but there are also many indicators of the traditional recession that have been flashing for a while, so I don’t think you can rule it out.”
The cryptocurrency market is still trading in a significant correlation with high-tech stocks. This means that the recession will cause widespread sales, he added.
Related: Libra, Melania creator “Wolf on Wall Street” Memocoin crashes 99%
Concerns about the current trade war, driven by US President Donald Trump’s import duties and continued retaliation measures, have rekindled concerns about a potential recession.
sauce: Polymate
More than 40% of market participants are hoping for a US recession this year, starting from just 22% a month ago on February 17, according to Polymarket, the largest diversified forecast market.
https://www.youtube.com/watch?v=6unogdvqwre
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