Amid growing fears of recession and rising interest rates, the cryptocurrency market succumbed to extreme volatility. Bitcoin is hovering between $18,000 and $20,000. The same goes for the main altcoin, Ethereum, which has lost its key level of $14,000 and is hovering around $1,300.
However, according to industry experts, the expected economic crash would benefit the crypto market. Yesterday, October 3, the United Nations agency alerted central banks and the Federal Reserve to an impending recession. On the other hand, the crypto market has not faced much volatility over the past few weeks.
Could a recession prove beneficial for the crypto market?
The UN agency claimed that with an attempt to raise interest rates, central banks are moving closer to recession days. In addition, reports from the Wall Street Journal claim that, according to the agency, if the Fed continues its move towards interest rate hikes, developing countries will be more affected than developed or underdeveloped countries.
Meanwhile, the United Nations Conference on Trade and Development (UNCTAD) believes that the Federal Reserve’s attempt to raise the interest rate will bring down the economies of many developed countries.
Now, when it comes to the recession affecting the crypto market, industry experts are divided as most of them fear that if the stock market goes down, so will the crypto market.
However, one of the American investors, Stan Druckenmiller, believes that the recession, which will occur in 2023, should benefit the crypto market. Indeed, according to the investor, if people lose faith in central banks, they turn to crypto assets. It’s just not that; the expert also claims that due to its decentralized operation, the crypto market, especially Bitcoin, will gain people’s trust.
At the time of writing, Bitcoin is selling at $20,109 after rising 0.75% in the last 24 hours.