Analysts are sounding the alarm: overheating of US markets threatens bitcoin
US markets are in a zone of extreme overheating — this is the conclusion reached by two authoritative analysts, whose assessments complement each other. Bloomberg Intelligence strategist Mike McGlone predicts a "once-in-a-lifetime reversal," while Bridgewater founder Ray Dalio warns of multi-year negative real returns for US stocks.
McGlone: Bitcoin falls first
McGlone notes that the market "dominoes" are already starting to fall. Bitcoin, which previously led the rally, is now the first to collapse. According to his observations, the ratio of US government bonds to gold is approaching a forty-year low, and the summer could be extremely turbulent.
The US stock market capitalization relative to GDP is at an all-time high, not seen since 1928–1929. About 80% of participants predict a rise in the S&P 500 index by year-end, although a drawdown is more likely for a US midterm election year. McGlone draws a parallel with 2008, when oil first soared and then crashed. The current surge in initial public offerings (IPOs) resembles the launch of Bitcoin ETFs in 2024, which preceded the market peak. The falling Bitcoin, in his view, is precisely foreshadowing this future reversal.
Dalio: Concentration in AI is a dangerous bet
Ray Dalio paints a similar picture, but through a macroeconomic lens. He warns that markets are now extremely concentrated in a small group of large companies related to artificial intelligence. According to his forecast, the real return on US stocks could range from -5% to -10% per year over a 5–10 year horizon.
Dalio assesses the situation through the concept of "five forces": debt and monetary policy, domestic politics, geopolitics, natural phenomena, and technological change. Historically, technology cycles are accompanied by inflated valuations, high volatility, and unclear long-term winners. Therefore, making a large bet on a narrow group of leaders is risky. He advises investors to avoid excessive concentration and build well-diversified portfolios balanced by risk.
What does this mean for Bitcoin?
Both opinions are linked by a common idea: US markets are overheated, overvalued, and sustained by excessive optimism. For Bitcoin, this carries a double risk. On one hand, as the risk asset most sensitive to liquidity, it may fall first during a general reversal — as McGlone pointed out. On the other hand, if overvalued stocks indeed yield negative returns, some capital could eventually flow into Bitcoin as an asset weakly correlated with the stock market.
My expertise: The signal from McGlone and Dalio is not just a warning, but an indicator of a macro cycle shift. Bitcoin, acting as the "canary in the coal mine" for risky assets, is currently testing the market's ability to sustain further growth. Investors should prepare for increased volatility and reconsider their allocation in favor of safe-haven assets, including gold and possibly Bitcoin itself as a hedge against systemic risks.