Venture Capitalist Makes ‘Severe’ Bitcoin Bear Market Warning

By August 23, 2019 Bitcoin Business
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Bitcoin has been trading sideways over recent months as traders and investors speculate over its potential as a safe haven asset similar to gold.

The bitcoin price yesterday fellow below the psycological $10,000 mark before rebounding, swinging more than $1,000 per bitcoin in under 24 hours and leaving market watchers with whiplash.

Now, amid fears the world economy could be tettering on the edge of a recession, a prominent venture capitalist and bitcoin investor has warned a "severe" financial crisis would weigh heavily on the price of bitcoin.

bitcoin, bitcoin price, image
If the global economy falls into recession, it could be difficult for bitcoin to hold onto its currency price.

"When you think about really severe crises taking place, a liquidity crunch, another global financial crisis, I think that bitcoin will struggle to do very well from a price perspective," Spencer Bogart, a general partner at venture capital firm Blockchain Capital, told Bloomberg, a financial newswire.

An array of economic indicators have triggered alarm bells that the world's economy could be about to stall.

Earlier this month, the closely-watched U.S. bond yield curve turned negative, meaning the cost of borrowing money for the U.S. government was lower over the longer-term than the shorter-term.

Elsewhere, Germany, the economic engine of Europe, recorded a drop in its gross domestic product during the second quarter of 2019; expectations are that its economy will contract again in the third quarter and enter into technical recession.

Bitcoin, bitcoin price, chart
The bitcoin price surged earlier this year before it ran out of steam. CoinDesk

"I think longer term bitcoin will absolutely be a safe haven," Bogard added.

"I mean as it grows up the adoption curve we see bitcoin kind of evolving as it goes. So I think right now it is kind of in this intermediate state right now where you really have to think what the risks are and how severe are they. So I think that when you have looming risks of monetary devaluation, things like this, bitcoin certainly looks very attractive, and I think that was a large driver of the recent run-up in price."

The bitcoin price yesterday fellow below […]

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