Russell Thompson, Chief Investment Officer of Nasdaq-listed crypto asset manager Hilbert Group (HILB), has issued a stark warning that tightening global liquidity conditions pose a significant near-term challenge for Bitcoin and other risk assets. Thompson predicts a broad liquidity contraction of 20–25% is approaching, which could suppress Bitcoin's price trajectory through 2025, even if geopolitical tensions ease.
In a report published last week, Thompson stated, "Even with a resolution quickly in Iran, I do not believe that risk assets will rally for any sustainable time without outside help." He emphasized that Bitcoin's performance is now dominated by macro liquidity, policy expectations, and investor positioning, marking a clear shift from the late-2025 market exuberance.
The analysis points to a fragile, macro-driven market environment. Bitcoin has experienced a full cycle over the past six months, soaring to an all-time high above $126,000 in October 2025 before entering a sustained drawdown. By February 2026, prices had fallen roughly 50% to around $63,000, amid broader crypto market sell-offs, ETF outflows, and a risk-off macro backdrop. Bitcoin is currently trading around $75,600, in a phase of tentative stabilization but significantly off its peak.
Thompson anticipates that U.S. policymakers will respond to the tightening conditions. Likely measures include reform of the Supplementary Leverage Ratio (SLR), a sizable drawdown of the Treasury General Account (TGA) without offsetting Federal Reserve bill issuance, and a series of rate cuts under a potential new Fed chair. He argues that markets are overly focused on the Fed for liquidity, while the U.S. Treasury has significant capacity to inject funds into the economy and financial markets.
Despite the near-term headwinds, the medium to long-term outlook remains positive. Thompson expects Bitcoin to be "significantly higher" by year-end as liquidity dynamics evolve. He projects that liquidity could bottom around 2027, a timeline that might coincide with fresh all-time highs for Bitcoin, driven by an improved liquidity environment and potential faster-than-expected expansion of the Fed's balance sheet as disinflationary pressures build.
