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The best and worst case for bitcoin hereon

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The best and worst case for bitcoin hereon

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Ever since the crypto markets fell from their all-time high in November 2021, price recovery has looked like a farfetched dream. Scott Minard, Global Chief Investment Officer at Guggenheim Partners believes that the majority of crypto is garbage. Here's what else the crypto bear and critic predicted.

The best and worst case for bitcoin hereon
Ever since the crypto markets fell from their all-time high in November 2021, price recovery has looked like a farfetched dream. Bitcoin has fallen 58 percent from its USD 69,000 peak to USD 29,000 at the time of writing. Bitcoin briefly sank to USD 28,291 on 27th May 2022, dragging the overall crypto market down with it.
The USD 28,000 mark is a crucial support level according to experts, and a fall from there could have far-reaching effects on the broader market.
There are mixed feelings about where Bitcoin will head from here. While some believe that there is still potential in the oldest blockchain, some remain skeptical about the inherent value of the cryptocurrency. Here’s a look at the best and worst outcomes for Bitcoin, as projected by crypto experts and technical analysts.
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Scott Minard, Global Chief Investment Officer at Guggenheim Partners, spoke with CNBC at the World Economic Forum 2022 meeting in Davos about the crypto rout and the Bitcoin situation. “When you break below USD 30,000 consistently, USD 8,000 is the ultimate bottom, so I think we have a lot more room to the downside, especially with the Fed being restrictive,” he said. “We are seeing crypto collapse the way it is. I think it’s got more downside,” he added.
Minard is a crypto bear and critic. Of the 19,000 cryptocurrencies in existence today, Minard called most of them “garbage.” However, he clarified that while most may fail, some will survive, and he expects Bitcoin and Ethereum to be among the survivors. “Let’s face it, most of these currencies are – they are not currencies, they are junk. The majority of crypto is garbage. So, there are going to be survivors,” he explained.
The quantitative easing policy of the Federal Reserve to tackle tremendous inflation rates isn’t exactly helping cryptocurrencies recover either. Interest rate hikes have overturned investor sentiments and have worsened the fear in the broader market. The Bitcoin Fear and Greed index currently shows a value of 12, which indicates extreme fear. On the scale, 0 shows extreme fear, and 100 signals extreme greed.
Bitcoin is also becoming increasingly correlated with the S&P500 and NASDAQ indices and is following the movement of blue-chip stocks. While the S&P500 index lost 4.7 percent over the last month, NASDAQ sank by 8.45 percent. In the same time frame, Bitcoin shed 26.6 percent.
“Right now, correlations are appearing across and within most asset classes, not just crypto,” said Beimnet Abebe, VP of principal trading at Galaxy Digital, to Blockworks earlier this month.
Investors are uncertain about market developments and continue to redirect their money into less risky assets. However, there are some market experts who believe that there is a light at the end of the tunnel for Bitcoin. So is there an upside, then?
“Bitcoin has been trading in a tight range for the past few days,” said Edul Patel, CEO and Co-Founder of Mudrex (a crypto investment platform) to the Financial Express. “BTC’s current support lies at USD 27,000, while the initial resistance holds at the USD 33,000 level. We may see BTC crossing USD 31,000 in the coming days as momentum improves over the past day,” he added.
Meanwhile, the most optimistic view has come from banking mammoth JP Morgan. It has pegged the fair price of Bitcoin at USD 38,000, which is 31 percent above the current Bitcoin price. “The past month’s crypto market correction looks more like capitulation relative to last January/February, and going forward, we see upside for Bitcoin and crypto markets more generally,” read the note that JP Morgan circulated to its clients. This is the best possible outcome that Bitcoin investors would’ve heard about in a long time.
The note also mentions that cryptocurrencies have usurped the spot of real estate as the preferred “alternative asset” for investment. “Thus far, there is little evidence of VC
Even WazirX analysts have put out a note saying that Bitcoin will make some headway in terms of recovery if it breaches the USD 31,000 mark. “The next resistance for Bitcoin is expected at USD 40,000, and an immediate support is expected at USD 24,000. BTC needs to break above USD 31K and push towards the USD 40K level to see a significant trend reversal,” the note read.
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