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How Global Macro Trends Might Affect Crypto in 2020

How Global Macro Trends Might Affect Crypto in 2020 101
Source: iStock/courtneyk

Crypto is not an island. While the most popular cryptocurrency, Bitcoin (BTC) is still considered to be a non-correlated asset, economic and financial developments have at least an indirect effect on crypto market behavior. Also, political and regulatory pronouncements can lead people towards crypto or scare them away.

There’s little doubt that the wider world will continue influencing the crypto industry in 2020. The question: how exactly will it do this, and what major global trends are likely to impact on crypto in the coming years?

It is estimated that economic conditions – and in particular low interest rates – might continue to make crypto and blockchain start-ups seem like an attractive investment, while many economists are still predicting a global recession next year that could increase crypto’s ‘safe haven’ status, which got into trouble recently.

But at the same time, the move of governments towards their own central bank digital currencies (CBDCs) could mean that decentralized cryptocurrencies are increasingly ‘squeezed out’ by tighter regulation.

2019: a mixed picture

What did experts predict would happen between the wider world and crypto in 2019? Well, to cut a long story short, they said that bearish stock markets, a struggling global economy, and Brexit would help drive interest in cryptocurrencies.

How accurate was this prediction? Firstly, stock markets recovered much of the value they had lost at the tail-end of 2018, making traditional assets more attractive.

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