A prominent economist has declared the start of a new long-term inflationary regime, potentially the most significant in three decades. This structural transition can profoundly impact the global economy and financial markets.
Notably, periods of rising inflation have favored Bitcoin (BTC), as its scarcity and speculative appeal tend to drive demand.
Can Rising Inflation Spark the Next Bitcoin Bull Run?
Henrik Zeberg, Head Macro Economist at Swissblock, recently shared a century-long view of the US government’s 10-year bond yield. His chart categorizes historical economic phases into inflationary and deflationary regimes.
It highlights a “rounding bottom” pattern in bond yields as a precursor to rising inflation, which has already appeared.
“Does not mean immediate inflation (on the contrary). But it means that the Economy and the Financial World in the coming decade will be completely different from what they have been for the last 30 years,” Zeberg wrote.
Zeberg’s analysis suggests that before a sustained upward move in yields, there may first be a deflationary bust in 2025. This, in turn, would prompt a strong policy response from the Federal Reserve. The turning point will trigger a new secular bull market.
Meanwhile, crypto analyst Michaël van de Poppe also stressed that the collapsing bond market may compel central banks to print more money. This could eventually lead to a debt bubble burst and a subsequent deflationary period. In a recent X post, he outlined a strategy to navigate this.
“What’s the way for you to get out of this? Maximize the coming years through investing into risk-on assets: Crypto, Altcoins, and Bitcoin,” he stated.
He recommended then shifting those gains into safer assets like commodities, Bitcoin (as a store of value), and cash ahead of the anticipated market collapse before eventually rotating back into risk assets during the recovery. Van de Poppe described this cyclical strategy as “probably the best game plan” to navigate the coming economic turbulence.
As the global economy braces for a potential inflationary regime, Bitcoin’s role as a hedge against rising prices continues to gain prominence. Geoff Kendrick, Head of Digital Assets Research at Standard Chartered, also highlighted this growing trend earlier.
Importantly, the inflationary outlook has already begun to influence financial markets, particularly Bitcoin. The largest cryptocurrency recently surged to a new all-time high, crossing $110,900.
Ryan Lee, Chief Analyst at Bitget Research, attributed this rally to several factors. These include institutional adoption, growing regulatory clarity, and a post-halving supply crunch.
“Macro conditions are doing their part. Rate cut expectations and persistent inflation reinforce Bitcoin’s appeal as a hedge, with many eyeing $113,000 as a realistic near-term target by June 2025,” Lee told BeInCrypto.
However, he cautioned that Bitcoin’s sharp rallies often precede corrections, citing potential risks such as a stronger US dollar or geopolitical tensions.
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