Make no mistake – cryptos are going higher into 2026 and beyond!

Unfortunately – we are looking at a harsh macro environment that could knock cryptos down in H1 2025 – or at least peg BTC prices at current levels as markets digest a nasty outlook.

Bitcoin and gold are both alternatives to cash – and both posted all time highs in USD terms over the past 6 months. When we look deeper into both complexes – some unsettling trends emerge.

Recent equity market turbulence points to issues in the macro liquidity situation. Despite US President Trump’s big changes – the economic fundamentals point to lower risk asset prices in the medium term.

The Trump Pump that hit markets in Q4 2024 ran its course – and now the bill is due.

Trump Is A Big Win For Cryptos

The crypto euphoria that hit markets in November 2024 was well placed. US President Trump is a big win for the crypto industry. Check out that XRP rally!

The problem is altcoins generally. After a big pump heading into year-end – most of the minor tokens are selling off into the new year. Even DOGE looks weak at the moment. Elon Musk is now one of the most powerful men in the USA – but DOGE (the token – not the new US government entity) is DOA.

We think there are big problems in the global marketplace. Maybe things look better on the surface, but the kind of optimism and liquidity needed for a phase-shift to higher prices isn’t there.

When the next big leg up happens – and the days of sub-million USD BTC are something for the history books – we wager that a very different macro environment will be in place. We also imagine most people will have some exposure to cryptos – which just isn’t the case at the moment.

Central Banks Aren’t Headed To 0%

Central banks – especially the FED – aren’t racing down the graph to 0% interest rates. Nor are extraordinary measures on the table like they were in 2008-9. Apparently, the FED is so freaked out about inflation that it plans to hold the course at current levels.

The recent hot US CPI print only adds weight to our view. Rates aren’t going much lower – despite a flailing global economy that is punishing the 99% at the bottom as the 1% rides their pile of assets to stratospheric heights.

We think that both Trump and FED know there has to be a crisis before rates can fall to lower levels – and quantitative easing can return. A global financial crisis would fit the bill – and one is certainly on the way.

Remember that the overnight rate in the US is still well below the actual inflation rate (don’t listen to the official rate – it’s a cruel joke). With an effective deep sub-zero overnight rate (by about 500 basis points) – more inflation in the coming years is guaranteed.

With more money chasing alternative assets like Bitcoin – a neck-snapping rally in the next few years is all but assured. We see it as a certainty – but the timing is tricky.

The FED understands that with trillions of USD set to be both issued and refinanced in 2025 – accommodative measures are needed.

Clearly, this is amazing for crypto prices in the medium term – but it’s also likely to create a downdraft as a global crisis metastasizes – and political cover for a free money party is manufactured.

Strange Bedfellows

The USD, BTC, and gold all look great over the past 6 months.

In the near term – this trend is unlikely to continue. A strong USD is an issue for multi-trillion US bond sales – and higher alternative asset prices aren’t great PR for the new McTrumper administration. He is a vain man.

The USD is the easiest solution to the problem.

While a higher USD would be bad for bond sales in a stable global market – if everyone was freaked out about return on capital – US debt would sell like crazy. In 2008 it didn’t matter that the US was the epicenter of financial armageddon – US government debt was the place to be.

Bitcoin didn’t exist in 2008 – but gold did. Gold cratered along with almost every other asset at the time – aside from US debt – the USD – and the JPY. In the following years, gold hit new all time highs, a trend that continues to this day.

This time around cryptos are hot – and could be entering a buy zone that is a once in a lifetime opportunity. Gold also looks good, although the medium-term gains in crypto will likely outpace every other asset class globally.

The USA And EU Are Wasted – China is Stillborn

A Trump presidency does nothing to address structural problems that are decades (or even centuries) in the making. We don’t have a functional global economy. The USA and EU are products of failed centralization models that destroy value.

Modern markets socialize losses and privatize gains. And we wonder why political systems don’t work.

Asia was the big hope for economic progress – but most East Asian nations are corrupt, centrally planned, and driven by dead end thinking that promotes population decline. And then there is the debt. Our world is floating on a pile of government debt that can’t be paid back.

Long story short – the global economy is effectively broken. There are no bright spots. It’s an anthracite coal mine that goes on forever into the abyss. None of this is reassuring for organic economic growth – and it means more government debt hitting the markets in ever larger amounts.

The modern monetary system is a fantastically large group delusion. It is defacto central planning – and there is no way to reform it. The crisis in 2008 was a dress rehearsal for the next crisis – and we think it will hit global markets in the coming years (not decades).

New Opportunities For Crypto Investment

Crypto is the king of beta – which makes it the perfect asset to hunt when markets collapse.

The Q4 2024 Trump pump demonstrated how quickly markets can move – and fall. Most tokens aren’t much higher now than they were before the Trump pump started. Take that fact as a cautionary data point. Markets look strained to the upside.

There is every reason to think that in a few years current crypto prices will look like amazing entry points. We are sure of this. However, given how much retail optimism exists in risk assets (not just cryptos), we are wary in early H1 2025.

Buying BTC at $96,000 is attractive – but $45,000 would be a LOT more attractive. We think that is possible in the next 18 months – or perhaps much sooner.