Leading international cross-border bank, Chartered Standard predicted sharp price drops for Bitcoinpredicting a pessimistic future outlook for the pioneering cryptocurrency amid a broader market downturn.
Bitcoin could plummet to $50,000
At the time of writing, the price of Bitcoin is trading above $59,000, according to CoinMarketCap. Cryptocurrency was experiencing massive price drops after Bitcoin halved on April 20, 2024, further compounded by the Federal Reserve’s (FED) decision to keep interest rates unchanged during the Federal Open Market Committee (FOMC) meeting on Wednesday, May 1.
Standard Chartered bank has warned investors of more price declines in the future, predicting that the price of Bitcoin could fall between $50,000 and $52,000, recording a loss of more than $20,000 from its all-time high of more than $50,000. $73,000 in March 2024. This new forecast follows the bank’s previous projection that predicted Bitcoin rises to $150,000 by the end of 2024.
Standard Chatered’s head of forex and digital asset research, Geoffery Kendrick, revealed a combination of factors that could boost The decline of Bitcoin in a statement to The Block on Wednesday. Kendrick highlighted broader macroeconomic influences and cryptocurrency-specific factors impacting the price of Bitcoin, particularly challenges such as the easing of liquidity measures in the United States since mid-April.
“Liquidity is important when it matters, but against a backdrop of strong U.S. inflation data and less likelihood of Fed rate cuts, it is important at this time,” Kendrick said.
Standard Chartered also cited the series of huge outflows witnessed by Spot Bitcoin ETFs in the USA, as well as weak performance of Ethereum Spot ETFs in Hong Kong, China.
On May 1, approximately 10 US spot Bitcoin ETFs recorded surprising outflows, collectively totaling $563.7 million. Kendrick also revealed that “more than half of spot ETF positions are underwater.” He suggests that liquidity risk should be considered, especially as investor sentiment may be moving away from these digital assets.
BTC Price Jumps Over $1,000 Amid Market Slowdown
Sometime on May 2, Bitcoin witnessed significant price drops that pushed its value below $58,000. However, currently the cryptocurrency has seen an increase of over 1.56%, increasing over $1,000 in just one day.
Several analysts have predicted further declines for the cryptocurrency, expecting Bitcoin to bottom during this down period. Analysts like Ali Martinez and Michael van de Poppe anticipates a few more price corrections before the broader market stabilizes, paving the way for Bitcoin to prepare for potential upside. bullish recovery.
BTC price jumps above $60,000 | Source: BTCUSD on Tradingview.com
Featured image from MarketWatch, chart from Tradingview.com
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