The US market has been facing challenges, with a June gauge monitoring business cycles showing a 15th straight monthly decline per Reuters. Deteriorating consumer confidence and increased unemployment claims contributed to the ongoing slide. This marks the longest downward stretch since before the 2007-2009 recession, signaling potential economic contraction ahead.
Despite economic worries, many are looking to cryptocurrencies and digital assets as a potential bright spot. The Conference Board’s Leading Economic Index, forecasting future activity, fell 0.7% in June after a May drop, suggesting deceleration ahead.
But investor Hugh Hendry told CNBC he’d choose Bitcoin over gold amid recession concerns. Traders are also speculating on which cryptos could outperform if a US recession hits, with one analyst tweeting he’s confident Kaspa would be a top performer.
Even with indicators flashing warnings, crypto is offering optimism and a hedge for some against a potential downturn.
However, some don’t see crypto as a recession haven. With high volatility, Tastytrade CEO Scott Sheridan questioned if cryptocurrencies could offer a safe space.
Bitcoin and Ethereum fell over 70% from record highs as investors avoided risk amid rising rates. While major cryptos remain far below previous peaks, 2023 has seen a crypto rebound as traders anticipate an end to rate hikes.
Even with recent gains, many experts doubt digital assets will shield investors from an economic storm due to the market’s history of wild swings. Crypto’s ability to act as a recession shelter remains debated.
