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 The analyst told whether Bitcoin would be a good investment in the new global crisis

Bitcoin could be a “good bet” for investors if the Federal Reserve does its best to keep the US economy afloat – especially against looming recession risks . So says a popular analyst under the nickname Bitcoin Jack, who is on the side of cryptocurrency fans. He also noted the rising prices of essential commodities like oil and wheat, which have risen sharply amid the geopolitical conflict in Ukraine. We talk about what is happening and the prospects of Bitcoin in more detail.

What will happen to Bitcoin in the future?

During the crisis, European consumer prices rose 5.8 percent year-on-year in February from 5.1 percent the previous month, beating the economists' average forecast by 5.6 percent. Notably, the energy sector recorded the largest price fluctuation at 31 percent, much more than consumer goods.

The U.S. Consumer Price Index (CPI) rose 7.5 percent year-on-year in January 2022, the highest in nearly four decades, according to Cointelegraph sources . Analyst Bitcoin Jack hinted in this regard that inflationary risks associated with the Russian-Ukrainian crisis may leave the Fed with two options.

First of all, the Fed can aggressively raise interest rates to bring down inflation, thus raising the risk of a recession. Or its representatives will have to continue the program of reducing stimulus to the economy only to burden the economy with rising consumer prices and a decrease in the purchasing power of the US dollar. Here is an expert's remark in which he shares his vision of the situation.

If easing continues, inflation will continue to rise, Bitcoin and gold seem like good bets for now as long as a recession remains inevitable. But if all or almost all assets collapse, you will buy "phoenixes that will rise from the ashes."

That is, in general, the expert considers Bitcoin and other cryptocurrencies to be a suitable tool for investing in the most unpredictable world circumstances. Yet earlier, BTC has repeatedly recovered from its collapses, after which it set new price records. What is worth the fall of Bitcoin to the level of 4-5 thousand dollars in March 2020 against the backdrop of the spread of coronavirus. Since then, the main coin managed to set a record at the level of 69 thousand dollars - and this is a serious indicator of profitability.

The analyst analogy was drawn hours before US Federal Reserve Chairman Jerome Powell confirmed he would propose a 25 basis point rate hike at the next Federal Open Market Committee (FOMC) meeting in mid-March. Powell noted that the Fed was assessing the prospect of a gradual increase in rates until the end of 2022. But "Russia's recent invasion of Ukraine has prompted them to tread carefully." Here is a quote.

We are going to avoid adding uncertainty to what is already an extremely complex and uncertain moment in geopolitics.

However, Powell did not rule out the possibility of raising interest rates by half a percentage point if the next inflation figures are higher than expected.

If inflation turns out to be higher or more persistently high than it is now, then we will be ready to act more aggressively.

Representatives of the cryptocurrency community are confident that a softer increase in interest rates will enable investors not to forget about digital assets. Recall that during drastic changes in the economy, capital owners prefer to withdraw it from riskier assets, which just include the crypt.

Bitcoin continued to fall after Powell's speech, briefly dropping more than 2 percent on March 3 to below $43,000. The fall did not end there: today BTC is trading at $40.9 thousand. A four-hour BTC chart looks like this.

The move down contrasted with the jump in the US dollar index (DXY), which rose 0.25 percent over the same period. This suggests that in this time period, global investors prefer the dollar more against the backdrop of the crisis.

We believe that Bitcoin can traditionally play the role of a safe store of investment value. Yet earlier, the cryptocurrency has experienced crises more than once against the backdrop of a pandemic and other unpredictable events, but in the end it returned to its former highs and exceeded them. Be that as it may, now the holders of digital assets are hoping for relatively mild actions by the US authorities, which will create the conditions for communication with the crypto for others.

Look for even more interesting things in our millionaire crypto chat . There we will discuss other events related to the blockchain and decentralization industry.