Bitget App
Trade smarter
Buy cryptoMarketsTradeFuturesEarnWeb3SquareMore
Trade
Spot
Buy and sell crypto with ease
Margin
Amplify your capital and maximize fund efficiency
Onchain
Going Onchain, without going Onchain!
Convert
Zero fees, no slippage
Explore
Launchhub
Gain the edge early and start winning
Copy
Copy elite trader with one click
Bots
Simple, fast, and reliable AI trading bot
Trade
USDT-M Futures
Futures settled in USDT
USDC-M Futures
Futures settled in USDC
Coin-M Futures
Futures settled in cryptocurrencies
Explore
Futures guide
A beginner-to-advanced journey in futures trading
Futures promotions
Generous rewards await
Overview
A variety of products to grow your assets
Simple Earn
Deposit and withdraw anytime to earn flexible returns with zero risk
On-chain Earn
Earn profits daily without risking principal
Structured Earn
Robust financial innovation to navigate market swings
VIP and Wealth Management
Premium services for smart wealth management
Loans
Flexible borrowing with high fund security
Opinion: The current market is in a dangerous bubble zone, and cryptocurrency may become the new systemic risk trigger point

Opinion: The current market is in a dangerous bubble zone, and cryptocurrency may become the new systemic risk trigger point

Bitget2025/02/18 12:47

On February 18th, according to DL News, Wolfgang Münchau, co-founder and director of Eurointelligence and financial columnist, published a new analysis article stating that the current market is in a dangerous bubble zone. Cryptocurrencies could potentially trigger the next financial crisis.

The article points out three major risk factors: The valuation of the Meme coin market has reached $80 billion USD, with Dogecoin accounting for about half of the market value and TRUMP's market value reaching $3.8 billion USD. Although its scale is not yet threatening to the global financial system, it has already had negative impacts on markets such as Argentina. Stablecoin's market value has reached $225 billion USD and faces significant systemic risks. As stablecoin reserves are mainly allocated in US short-term government bonds, an increase in inflation prompting interest rate hikes by the Federal Reserve will lead to a sharp drop in reserve asset values. This asset-liability mismatch risk is similar to that of the Asian Financial Crisis in 1997. The cyclically adjusted price-to-earnings ratio (CAPE) of S&P 500 index is close to 40 which approaches historical highs during internet bubble periods; AI concept stocks represented by Nvidia may repeat history like tech stock bubbles at end of last century.

Münchau believes these seemingly independent bubbles might merge into a "super bubble". Factors such as Trump-related policies (like trade wars or excessive tax cuts), relaxed cryptocurrency regulations etc., could all be potential triggers leading to domino effects within global finance via rising inflation rates, bond-market crashes or stablecoin crises - mechanisms similar those seen during 2008’s financial crisis may reappear.

0

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Earn new token airdrops
Lock your assets and earn 10%+ APR
Lock now!