Bitcoin Reflects Bearishest Growth Outlook Since Covid and FTX Crisis, Bitwise Research Finds

Bitcoin is trading as if a recession is imminent, even though macroeconomic indicators point to improving growth.

André Dragosch, European Head of Research at Bitwise Asset Management, highlighted on Friday that bitcoin reflects the most bearish global growth outlook since the 2022 Fed tightening cycle and the 2020 COVID-19 crash. Drawing on survey data from Sentix, ISM, and the Philly Fed, Dragosch showed a stark divergence: bitcoin’s implied growth outlook has plunged below -1 standard deviation, while survey-based macro indicators remain near neutral. He compared the setup to March 2020 and November 2022, periods that preceded major bitcoin rallies.

“Bitcoin is essentially pricing in a recessionary growth environment,” Dragosch wrote, describing the risk-reward setup as asymmetric. “You’re not even remotely bullish enough,” he added, suggesting a recovery could mirror the sixfold rally after the March 2020 COVID shock.

Crypto sentiment remains subdued. The CMC Crypto Fear and Greed Index stood at 20 (“Fear”) on Saturday, slightly above its year-to-date low of 10 on Nov. 22.

Bitcoin traded at $90,559 as of 11:30 a.m. UTC on Nov. 29, down 0.8% in 24 hours and 28% below its all-time high of $126,080. Meanwhile, the CME FedWatch Tool shows an 86.4% probability that the Federal Reserve will cut rates by 25 basis points at its December meeting.