Bernstein Analysts Discuss Bitcoin's Long-Term Value Amid Economic Shifts

According to PANews, analysts from brokerage firm Bernstein have highlighted in a report to clients that if tariffs lead to a stronger dollar, rising inflation, and reduced prospects for interest rate cuts in the short term, it could result in decreased global liquidity for risk assets. Over a longer period, as governments take on higher debt and deficits, leading to further currency devaluation, Bitcoin holds relative value against the dollar, a trend evident in Bitcoin's historical performance. However, in the short term, Bitcoin is correlated with risk assets, making the recent cryptocurrency sell-off unsurprising. Bernstein analysts suggest that in the long run, the Trump administration views cryptocurrencies as strategically significant for government governance and national finance. The administration aims to control inflation through deficit reduction, cost-cutting measures led by Elon Musk's government efficiency department, and increased energy production. Although foreign governments might retaliate against tariffs by selling U.S. Treasury bonds, Bernstein anticipates that sovereign nations will stockpile gold and Bitcoin as economic buffers. The United States is expected to lead the shift in supporting cryptocurrencies, with more countries likely to follow suit.