In a recent interview, Robin Brooks, former chief economist at the Institute of International Finance (IIF), argued that Bitcoin has been sidelined during the latest wave of global risk aversion.

Brooks pointed out that if Bitcoin were truly the “ultimate hedge” against fiat debasement, it should have benefited from the current global flight to safety. Instead, the cryptocurrency has behaved as a risk asset rather than a safe haven.

“The chapter about Bitcoin as a safe-haven asset is done and dusted,” Brooks said, highlighting that Bitcoin has fallen sharply at the very moment investors were seeking protection against currency debasement and macroeconomic uncertainty.

The “Debasement Trade” Ignites

Since Federal Reserve Chair Jerome Powell’s dovish Jackson Hole speech on August 22, investors have aggressively pursued assets traditionally considered safe. This “debasement trade” has favored precious metals like gold and silver, as well as fiat currencies from low-debt nations such as Sweden and Switzerland.

In contrast, Bitcoin has been largely ignored, falling more than 25% since the Jackson Hole remarks. Brooks emphasized that the flagship cryptocurrency cratered when a safe-haven surge would have been expected, underscoring its failure to play the role many had anticipated.

Can Bitcoin Recover in 2025?

Despite underwhelming performance so far in 2025, research firm BTIG remains cautiously optimistic. Following Bitcoin’s recent 36% peak-to-trough correction, the firm projects that the cryptocurrency could rebound toward $100,000, describing the ongoing rally as a “reflex rally” with additional upside potential.

Bitcoin has recently climbed to around $92,450, up 10% over the past week, but it remains roughly 20% lower on the month, reflecting persistent macro uncertainty and capital rotation toward traditional safe-haven assets such as gold.

As Bitcoin navigates its role in a volatile macro landscape, market participants will be watching closely to see whether the cryptocurrency can regain its status as a hedge—or continue to trade as a speculative risk asset.