BlackRock Executive: US Recession Could Be a Major Catalyst for Bitcoin

Bitcoin could emerge as a significant beneficiary in the event of a U.S. recession, according to Robbie Mitchnick, BlackRock’s head of digital assets. In a March 19 interview with Yahoo Finance, Mitchnick explained that Bitcoin is well-suited to thrive in a macroeconomic environment characterized by high fiscal spending, low interest rates, and monetary stimulus—conditions that typically arise during recessions.

While uncertainty remains about whether the U.S. will enter a recession, Mitchnick believes that such an economic downturn could serve as a key catalyst for Bitcoin. “I don’t know if we’ll have a recession or not, but a recession would be a big catalyst for Bitcoin,” he said.

Mitchnick highlighted several factors that could benefit Bitcoin in a recessionary scenario, including increased government spending, the accumulation of fiscal deficits, lower interest rates, and expanded monetary stimulus. These elements tend to occur during economic slowdowns and are generally supportive of Bitcoin’s growth, he noted. Additionally, Mitchnick pointed out that Bitcoin can also be driven by "fears of general social disorder," which may become more prevalent during recessions.

Despite these positive factors, Bitcoin is often misunderstood in the market. According to Mitchnick, the broader market is “not particularly well calibrated” to Bitcoin, with many still considering it a “risk-on” asset. Risk-on assets, such as stocks and high-yield bonds, typically suffer during economic crises. However, Mitchnick contended that Bitcoin is often mislabeled as a risk-on asset, and he believes this misconception presents an opportunity for further education in a still-nascent market.

“We’re helping some of our clients see through these conflicting narratives,” Mitchnick said. Some of BlackRock’s more sophisticated, long-term Bitcoin investors view the current market correction as an opportunity to accumulate more Bitcoin, despite the prevailing economic challenges.

While BlackRock maintains a positive outlook on Bitcoin, other players in the cryptocurrency space are more cautious. In its monthly outlook report on March 17, researchers from Coinbase noted that recession fears and recent tariffs have shifted sentiment, diminishing the positive outlook that many had for the first quarter of 2025. "Fears of a dramatic U.S. economic slowdown or even recession have caused sentiment to turn sharply," Coinbase Institutional said in the report.

BlackRock, a major player in institutional Bitcoin investment, has contributed significantly to the growing adoption of Bitcoin among wealth advisors and institutional clients. Through its iShares Bitcoin Trust ETF, BlackRock currently holds the largest net assets of any Bitcoin investment product, valued at $48.7 billion.

Despite recent outflows from many spot Bitcoin exchange-traded funds (ETFs), Mitchnick remains unconcerned. He emphasized that most of the outflows are attributable to hedge funds unwinding spot-futures arbitrage trades rather than long-term buy-and-hold investors. This distinction, he believes, underscores the strength and stability of Bitcoin’s long-term investment appeal.

As of now, Bitcoin is trading at approximately $86,000, marking a 3.8% increase over the past 24 hours. With BlackRock’s support and the ongoing institutional push for Bitcoin adoption, the cryptocurrency is well-positioned to benefit in the event of an economic downturn, according to Mitchnick’s assessment.