According to Robbie Mitchnick, BlackRock’s Global Digital Asset Manager, institutional investment in Bitcoin (BTC) has been strengthened, but its prices have struggled to reflect the growing demand.
Despite continued recruitment by large financial players, Bitcoin has experienced significant ETF leaks and cautious sentiment in early 2025, with prices falling below previous highs.
Mitchnick noted that despite the optimism surrounding Washington’s regulatory change, short-term market behavior and macroeconomic uncertainty have slowed momentum.
A recession may be a catalyst
Speaking to Yahoo Finance on March 18, Mitchnick argued that the basic characteristics of Bitcoin (scarcity, decentralization, independence from the traditional financial system) are positioned as a powerful hedge against the economic downturn.
He further suggested that the US recession could serve as a major catalyst for Bitcoin’s next rally.
According to Mitchnick:
“The recession is a huge catalyst for Bitcoin. It means long liquidity and benefits from increased fiscal spending, accumulation of deficits and lower interest rates.
Mitchnick emphasized that gold has skyrocketed high amid growing economic uncertainty, but Bitcoin has not yet reflected that trend. He attributes this difference to the trend in short-term trading in Bitcoin. There, it is often treated as a risk-on asset rather than a valuable repository.
Additionally, he explained that the recent Bitcoin ETF outflow is driven primarily by hedge funds that unleash Spotfuture’s arbitrage trading rather than long-term investors leaving the market.
He emphasizes that institutional trust in Bitcoin remains strong despite its short-term volatility.
“There are still many long-term core holders in it.”
US Bitcoin Reserve
Mitchinik also focuses on President Donald Trump’s move to establish a strategic Bitcoin reserve in the US, calling it a powerful support signal for BTC’s unique status within the digital asset space.
However, he noted that details of how the government acquires and manages Bitcoin remained unknown, and this is not useful for the current uncertainty that is common in the market.
Mitchinik also showed that institutional capital is still flowing into the market. He said it appears that professional investors are using the current dip, and that many people seem to be treating the weakness in Bitcoin’s price as an opportunity to accumulate.
He said:
“Some of the most sophisticated Bitcoin accumulators we talk about treating this dip as an opportunity.”
Despite ongoing regulatory uncertainty and security concerns in the broader crypto industry, Mitchinik remained optimistic about Bitcoin’s long-term role.
He also argued that investors viewed Bitcoin as a hedge against traditional financial instability and could have sparked momentum in the last few months amidst an uncertain economic landscape.
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