Cryptocurrency economist Timothy Peterson has issued a stark warning about an impending bear market and recession, suggesting significant implications for Bitcoin. Peterson, known for developing a proprietary market indicator, claims his metric has “fully triggered” for the first time since 2021, signaling a period of economic stagnation and market downturn.
Peterson’s indicator, the Secular Market Indicator, published in the Journal of Wealth Management, incorporates gold as a proxy for hard assets, differentiating it from traditional indicators like the Shiller P/E ratio or the Buffett Indicator, which he argues failed to predict the 2008 financial crisis. According to Peterson, his metric boasts a “remarkably accurate” history spanning over a century.
The indicator predicts both the long-term, annualized return on stocks and the likelihood of major recessions and bear markets. Peterson’s analysis suggests a limited return on equities, not exceeding 5% annually through 2034. He further forecasts a significant bear market within the next two years, comparable to those experienced in 2000, 2008, and 2022. Based on past observations, Peterson anticipates the market downturn could begin as early as Summer 2025.
Regarding Bitcoin, Peterson warns that the cryptocurrency will not be immune to the impending market crash, drawing parallels to its performance during the 2022 bear market. He anticipates a similar negative impact on Bitcoin’s price during the predicted downturn.
