High Inflation And Recession Fears Will Drive Bitcoin Adoption

It’s safe to say CZ is bullish on bitcoin and crypto’s future. Changpeng Zhao visited CNBC’s Squawk on the Street and flipped the prevalent bearish narrative on its head. This took just 2 minutes. Most of the things CZ said are based on common sense and a basic understanding of market forces, but still, it’s calming to hear a leader of the industry saying them. Especially in this fear-ridden stage of the cycle we’re in.

Notice that even though Binance’s business is dependent on altcoins’ performance, especially BNB, CZ makes a clear distinction between bitcoin and crypto in general. CZ also sneaks in crypto, even though it’s about bitcoin. 

In any case, let’s analyze what Binance’s CEO thinks about the current market conditions and the future of bitcoin and crypto.

CZ Squawked What on US National TV

The first thing the interviewer was interested in was the way that bitcoin bulls have defended the “20Kish” line. According to CZ, that was “the last peak” so there’s a “psychological barrier” there. So far, bitcoin’s price had never go lower than the previous cycle’s all-time high. It was this time different probably due to Tesla’s paper handsThe Terra crash. But the market ultimately defended the 20K line.

The interviewer then asked about other factors, like the increase in money supply or the bitcoin’s correlation to Nasdaq. According to CZ, those are two relevant factors, but in the end “it’s a mass psychology market” and the last ATH is the barrier. It’s only fair that we quote Binance Academy for an explanation of The psychology behind market cycles:

“In short, market sentiment is the overall feeling that investors and traders have regarding the price action of an asset. When the market’s sentiment is positive, and prices are rising continuously, there is said to be a bullish trend (often referred to as a bull market). The opposite is called a bear market, when there is an ongoing decline in prices.”

As we do regularly here at NewsBTC we have recently done this: You can check out fear and greed.index to gain insight into market sentiment. Here’s what we discovered:

“Last week, the indicator’s value had risen up to even 34 as the coin’s price saw a recovery rally. The sentiment among investors sank as crypto fell again after the end of the bull run.

The report notes that this trend indicates participants in the BTC (and wider crypto) market believe that this recent rally was just a fakeout.”

BNBUSD price chart - TradingView

BNB chart price on BinanceUS Source: BNB/USD tradingView.com| Source: BNB/USD on TradingView.com

What’s the next catalyst?

The next question in the interview was to find out what factors could propel bitcoin and cryptocurrency into the next chapter. CZ admitted that nobody can predict this accurately. “Nobody really forecasted NFTs, DeFi, etc. Which probably drove the last bullrun.” And in 2017, ICOs seemed to be the catalyst. “Six months before those things happened, very few people can forecast it.”

CZ speculated at the time. CZ believes that this market is much larger, and there are so many more applications. It is improving, as most countries are adopting regulation frameworks to allow cryptocurrency and bitcoin. It’s hard not to be bullish in an environment like this, even if the market is still fearful about the prices.

This last sentence is hilarious and refers to the present state of the world. “The macroeconomic situation, there’s going to be high inflation, the talk about recession, etc. All of those things drive adoption into bitcoin… into crypto.”

Featured image: CZ screenshot Charts by TradingViewfrom the video | Charts by TradingView

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