Amid global economic volatility, Robin Brooks, the former Chief Economist at the Institute of International Finance (IIF), has delivered a scathing critique of Bitcoin, stating that the world’s leading cryptocurrency has been "sidelined" after it completely failed a crucial test that should have cemented its status as “Digital Gold” or a safe-haven asset against currency debasement.
❌ Disappointing Failure as a Safe-Haven Asset
Brooks points out that since Fed Chair Jerome Powell's Jackson Hole speech on August 22, which fueled concerns over public debt and fiat currency depreciation:
Global investors flocked to sell risky assets and buy traditional safe havens like Gold and currencies of low-debt nations (e.g., Sweden and Switzerland) to protect their wealth.
In stark contrast, Bitcoin, once touted as The Ultimate Hedge, was dumped like any other risky asset, with its price plummeting over 25% during the exact period it should have surged against the market trend.
Brooks' verdict on Bitcoin's status is clear and harsh: he asserts that the narrative of Bitcoin as a safe-haven asset is dead because its price behavior during the recent crisis proves the market does not view it as a hedge. The fact that the price crashed while safe-haven assets soared is undeniable proof that Bitcoin failed in this role, and its remaining status is merely a "speculative toy."
📈 Hope at $100,000: The Risky Asset Recovery
However, not all analysts share this pessimism. Research firm BTIG maintains a positive outlook, predicting that Bitcoin has a good chance of rebounding to the $100,000 level following its major correction. They view the recent recovery—which pushed the price to $92,450 (a 10% gain over the past week)—as merely the start of a Reflex Rally with ample momentum, despite the monthly view remaining down by over 20%.
This differing perspective highlights the conflict in interpreting Bitcoin in the global financial market: Is it a failed safe haven, or merely a fast-recovering Risk-On asset after a correction?
