Recessions in the United States have historically been turbulent times for investors. Economic downturns often bring falling asset prices, rising fear, and difficult choices about where to invest. This guide compares the performance of both asset classes in past U.S. recessions, including the COVID crash and the 2022 slump. We look at correlations, highlight where crypto outperformed or lagged, and break down the risks of investing in both asset classes. Should you buy crypto or stocks in a recession? Here’s what to know.
KEY TAKEAWAYS
- Bitcoin often drops hard in recessions but can rebound faster and outperform traditional markets during recovery phases.
- Stocks tend to decline during recessions but remain more stable and historically recover over time.
- Bitcoin could become a better recession hedge if it consistently decouples from traditional markets.
- A balanced portfolio that includes stocks, crypto, and cash (improves resilience and flexibility during economic downturns) is ideal.
Crypto vs. stocks in a nutshell
…
Stock market performance in past recessions
…
Crypto and stock market correlation in recent downturns
…
When crypto outperforms stocks (and vice versa)
…
Risk analysis: Crypto vs. stocks in a recession
…
Portfolio strategies for a recession
…
Frequently asked questions
…
Disclaimer
…