Bitcoin Faces Short-Term Pressure Amid Tightening Liquidity, According to Hilbert Group CIO

According to Russell Thompson, Chief Investment Officer at Hilbert Group, global liquidity is on the verge of a sharp deterioration. Thompson believes that even a swift resolution to the geopolitical tensions in Iran may not be enough to sustain a rally in risk assets without external support. The recent stabilization of liquidity conditions in certain parts of the financial sector, following the introduction of the reserve maturity program, may be short-lived, as a broader tightening of 20-25% is anticipated, which could pose a significant challenge for bitcoin in the near term. Thompson expects U.S. policymakers to intervene, potentially through reforms to the supplementary leverage ratio, a substantial reduction in the Treasury General Account, and a series of interest rate cuts under a new Fed chair. The performance of bitcoin over the past six months has been marked by high volatility, shifting from extreme enthusiasm to a more fragile, macro-driven market. After reaching an all-time high of over $126,000 in October 2025, bitcoin experienced a prolonged decline, falling to around $63,000 by February 2026, a drop of approximately 50% from its peak. Currently, bitcoin is trading at around $75,600, significantly below its peak but no longer in freefall. The last six months have seen a complete cycle, from peak euphoria to a deep correction, and now a tentative stabilization phase, driven by macro liquidity, policy expectations, and investor positioning. Advances in crypto regulation could also provide support, with Thompson anticipating legal clarity on key measures before the summer recess and a faster-than-expected expansion of the Fed's balance sheet as disinflationary pressures build. Thompson argues that higher oil prices could ultimately weigh on growth, while a softening labor market and emerging stress in private credit may add to the disinflationary backdrop. Markets remain overly focused on the Federal Reserve as the primary source of liquidity, but Thompson believes the U.S. Treasury has significant capacity to inject funds into both the real economy and financial markets. As a result, Thompson expects short-term pressure on bitcoin, but improving conditions over the medium term, with bitcoin potentially reaching significantly higher levels by the end of the year as liquidity dynamics evolve.