‘Peak Bubble’: Bitcoin To ‘Lose A Zero’, Drop To $10k Says Bloomberg Strategist | Mike McGlone
Speakers
Mike McGlone
— Senior Commodity Strategist, Bloomberg Intelligence
David Lin
— Founder & Host, The David Lin Report / ex-Anchor, Kitco News
Summary
Mike McGlone, Senior Commodity Strategist at Bloomberg Intelligence, argues markets are in a 'peak bubble' and expects major volatility into year-end 2025. He thinks Bitcoin could lose a zero toward $10,000, US stocks face a 50% drawdown risk, and crude oil/copper/corn are deflationary, while gold should outperform and reach $4,000. He also warns MSTR/Bitcoin treasury companies are reflexive risk and discusses Fed easing as overpriced.
- McGlone says Bitcoin at $100k was a sell signal and could fall back to $10k as a high-beta risk asset.
- He expects gold to $4,000 and to outperform risk assets on central-bank buying, ETF inflows, and stock-market volatility.
- He forecasts crude oil to $40 and sees copper, corn, and broad commodities pressured by China deflation and weaker demand.
- He says the S&P 500 is overvalued and at risk of a 50% drawdown, with VIX/volatility rising into December.
- He warns MicroStrategy and Bitcoin treasury companies face NAV premium compression and forced liquidation risk.
- He says Fed rate cuts are heavily priced in and may mark the endgame of liquidity-driven risk-asset gains.
Ideas
Bitcoin likely loses zero to 10k
Bitcoin added a zero to reach $100k, which he saw as a classic sell signal because everyone was bullish. It is proving to be a high-beta risk-on asset with record correlation to the S&P 500, and with roughly 20 million other cryptocurrencies creating unlimited supply, buying and holding is unattractive. He expects a normal 50%-70% crypto drawdown, with Bitcoin possibly losing a zero and returning to $10k if the US stock market loses momentum.
Gold to 4k, outperform risk assets
Gold should continue to outperform most risk assets and head to $4,000 because central-bank buying, ETF inflows after four years of outflows, and diversification away from expensive US equities and tariff uncertainty are supporting it. He sees the gold/S&P 500 ratio bottoming and expects a pickup in stock-market volatility to be the catalyst for the next leg higher; gold also benefits from the Trump administration's disruption of the world order and from normal post-inflation deflation.
S&P 500 down year, 50% drawdown
His base case is a down year for the S&P 500 and the start of the third 50% drawdown since 2000, coming from record-high valuations, an overdue recession, tariffs that cut profits, and an extreme wealth effect that is holding up inflation. He expects major volatility into December and says Q4 2025 will not be pretty for stocks and risk assets unless the market stays elevated.
Volatility to rise into December
The VIX reached its low for the year in August and has already moved back up. Mike expects the summer doldrums to shift into higher volatility, with major volatility into December and a difficult fourth quarter for risk assets; this is consistent with his view that the stock market is overdue for a drawdown.
Crypto supply glut, avoid buy-hold
The broad crypto space has unlimited supply: CoinMarketCap lists roughly 20-21 million cryptocurrencies after starting with one in 2009, and people are rotating from Bitcoin into other tokens. He views this as a highly speculative commodity space that is riding on top of the most expensive US stock market in history, and he expects a prolonged down phase when risk assets revert.
Dogecoin can lose zeros
Dogecoin tracks nothing and is essentially a joke, yet its market cap is still around $31.6 billion. He says it can lose a couple of zeros and still be too expensive, and he expects that de-rating to happen as the broader speculative crypto cycle turns.
Gold/oil ratio heading to 100
The gold/oil ratio is at unprecedented levels near 53-54 barrels per ounce, versus prior year-end highs around 39 in 1933 and 2020, and he expects it to go to 100. That target follows directly from gold heading to $4,000 and crude oil heading to $40, and it signals a broader economic slowdown/deflationary commodity shock.
Oil heading lower toward $40
Crude oil is likely heading back to $40 because China's demand has plateaued, electrification/EV adoption is a paradigm shift away from fossil fuels, US/Canada supply is abundant and export-oriented, and OPEC is adding supply. He notes US break-even costs near $55 and expects oil to break below $55 toward $40 rather than stay above $80, especially if the stock market falls and adds deflationary pressure.
Gold/S&P ratio bottoming, prefer gold
Gold divided by the S&P 500 looks like it is bottoming and forming a pattern similar to 1967-1972, around the end of the gold standard. He sees the US stock market peaking versus the rest of the world and expects gold to outperform equities, so he is sticking with 'the rock versus stocks.'
Commodities except gold face deflation
He is not bullish on commodities except gold. The Bloomberg Commodity Index is stuck between inflated risk assets, especially the S&P 500, and deflationary pressure from China, and declining crude oil, natural gas, and grains are showing deflationary leanings that typically follow 2022-style spikes.
Corn 200-day average heading lower
Corn is one of the three key 'C' commodities, and its 200-day moving average is clearly heading lower. He groups it with crude oil and grains in a lower price-curve trajectory, though he notes grains may be getting closer to bottoms.
Copper likely breaks down with deflation
Copper is at a significant trend line after a parabolic rise and looks similar to crude oil in 2008 before it collapsed. With China, the key demand engine, exporting deflation, he fears copper breaks down, which would drag broader risk assets and commodity markets lower; he calls copper the key thing to watch right now.
MSTR premium to NAV compresses
MicroStrategy/Strategy is the leader of the Bitcoin treasury trade and has broken below its 200-day moving average for the first time since the previous cycle while still trading at a significant premium to NAV. He expects the premium to revert to a discount, after which it may be time to buy, so the current risk/reward is downside-oriented.
Bitcoin treasury model risks liquidations
Bitcoin treasury companies are a systemic risk: combining Bitcoin with corporate treasuries is an oxymoron, and when Bitcoin drops sharply these vehicles can be forced to liquidate or get stopped out. He says the model is an example of 'peak bubble' and expects these tickers to suffer when Bitcoin loses a zero, though he might revisit Bitcoin after the washout.
Up Next
This The David Lin Report video, published September 02, 2025, features Mike McGlone discussing BTC, GLD, SPY, VIX, Cryptocurrencies, DOGE, Gold/Oil ratio, WTI, Gold/S&P 500 ratio, DBC, CORN, COPPER, MSTR, Bitcoin treasury companies. 14 trade ideas extracted by AI with direction and confidence scoring.
Speakers: Mike McGlone · Tickers: BTC, GLD, SPY, VIX, Cryptocurrencies, DOGE, Gold/Oil ratio, WTI, Gold/S&P 500 ratio, DBC, CORN, COPPER, MSTR, Bitcoin treasury companies