Crypto Experts Maintain Bullish Bitcoin Outlook Despite Stagflation Concerns
Crypto analysts remain optimistic on Bitcoin amid signs of potential U.S. stagflation, focusing on anticipated Federal Reserve rate cuts and the broader structural bull market in digital assets.
Recent economic data highlighted mixed signals: consumer prices rose 0.4% month-on-month in August, pushing the annualized inflation rate to 2.9%, the highest since January. Meanwhile, first-time unemployment claims surged to a four-year high, and the Bureau of Labor Statistics revised jobs data downward for the year ended March 2025.
Despite these challenges, traditional markets shrugged off the risks. The S&P 500 hit record highs, while the dollar index fell 0.5% to 97.50, as traders focused on expected Fed rate cuts rather than inflation worries.
Bitcoin and Altcoin Market Movements
Bitcoin (BTC) briefly topped $116,000, following a recent technical breakout, and was trading near $115,244 at the time of reporting. Altcoins, including Solana (SOL), Chainlink (LINK), and Dogecoin (DOGE), recorded larger gains over the 24-hour period.
Shane Molidor, founder of crypto advisory platform Forgd, said, “Bitcoin and crypto are absorbing capital as a hedge against fiat dilution and long-term fiscal instability, rather than purely as a risk-on asset like in previous cycles.”
Fed Rate-Cut Outlook Supports Bullish Sentiment
Traders widely expect the Fed to reduce rates by 25 basis points to 4% on September 17, with further cuts possible before year-end. Analysts believe the central bank will prioritize labor market support over short-term inflation concerns, providing a favorable environment for crypto markets.
Le Shi, managing director at crypto market maker Auros, observed that major tech stocks—the so-called Magnificent 7—remain resilient to stagflation risks, reinforcing bullish sentiment in crypto.
Sam Gaer, CIO at Monarq Asset Management, noted that any temporary market pullback under a stagflation scenario could strengthen Bitcoin’s long-term case as a scarce, non-sovereign asset. Markus Thielen, founder of 10x Research, highlighted that disinflation trends are likely to resume, supporting risk assets and enabling a bullish finish to the year.
Altcoins and High-Beta Tokens
Solana (SOL) has seen strong momentum, with SOL/BTC trading at a seven-month high and approaching key psychological levels. Over $1 billion has been raised through various SOL vehicles, fueling rotation into the token.
Other notable tokens include Ethena’s ENA and synthetic dollar USDe, as well as Hyperliquid’s HYPE token. Molidor explained that younger investors are seeking high-beta exposure through leveraged perpetuals, making platforms like Hyperliquid increasingly popular.
Falling Fed rates also enhance the appeal of crypto-based yield products like Ethena, creating an environment where these digital assets become more attractive than traditional fixed-income instruments.
Tokens to Watch
Auros identified CRO, SOL, BNB, and HYPE as key tokens positioned for growth in the coming market upswing, supported by liquidity inflows, macro tailwinds, and rotation into high-demand altcoins.
