Henrik Zeberg: Bitcoin Will Crash 90%

Zeberg argues that monetary easing cannot fix underlying solvency problems, pointing to the 2008 crisis, when the Fed cut rates by 125 basis points in January even as a financial crisis still followed. He expects the Fed to respond if labor conditions become very weak, but says a weakening labor market—not rate cuts alone—is central to the risk.

Zeberg describes a vulnerable consumer alongside weak labor data: he says 66% of Americans live paycheck to paycheck, the median consumer cannot absorb an extra $2,000 expense, and revised job creation averaged 16,000 per month over the past year. He contrasts a 2%–3% savings rate today with 10%–20% in the 1970s, arguing consumers have less capacity to absorb higher prices.

Zeberg says AI investment and government spending are currently supporting the economy, but warns that a pullback in either could weaken it. He argues that AI-related hiring reductions could also lower income and consumption—which he puts at 68%–70% of GDP—while spare capacity of roughly 30% and near-term worker displacement could compound the pressure before productivity gains take hold.

Zeberg sees Bitcoin’s rally as potentially resembling the late-2021 bounce rather than the start of a traditional multiyear bull market, noting that its ratio against the S&P 500 did not make a new high. He also points to broken support lines, the decline after the ETF’s introduction, and elevated leverage and valuations as reasons he considers the setup vulnerable.