- According to Standard Chartered Bank, the price of bitcoin can drop as low as $50,000. The bank’s head of digital asset research ascribed this prediction to a combination of macroeconomic forces and crypto-specific elements.
- Furthermore, he stressed that more than half of spot exchange-traded fund (ETF) positions are currently underwater and cautioned about the possibility of liquidation for some of them.
Bitcoin Could Plunge to a Range of $50,000–$52,000
According to Standard Chartered Bank, the recent decline in Bitcoin’s value below $60,000 may be an indication of further difficulties to come.
Concerns related to cryptocurrencies were brought up by Kendrick, such as the withdrawals from U.S. spot bitcoin exchange-traded funds (ETFs) that have been occurring for several days in a row and the lackluster reaction to the recent launch of spot bitcoin and ether ETFs in Hong Kong.
“The risk of liquidation of some of the spot ETF positions must be considered as well,” he said, pointing out that more than half of the positions were underwater. Furthermore, he suggested that the low volume of Hong Kong spot crypto ETFs was partly to blame for the recent drop in bitcoin’s price.
The Standard Chartered analyst emphasized that pressure on Bitcoin’s price swings is coming from broader macroeconomic issues in addition to crypto-specific worries. He pointed out that since mid-April, liquidity measures have rapidly deteriorated, particularly in the United States. He also mentioned that assets like cryptocurrencies, which normally benefit from liquidity, are being negatively impacted by these tightening conditions.
According to Kendrick, liquidity is important when it matters, but right now it’s important given the solid U.S. inflation numbers and the decreased chance of Fed rate cuts.
Standard Chartered is holding onto its predictions for the price of bitcoin for the next year. The bank recently raised its end-of-year estimate for 2024 from $100,000 to $150,000. It also hinted that, depending on ongoing robust inflows into spot Bitcoin ETFs and prospective purchases by currency reserve managers beginning this year, bitcoin might reach $250,000 in 2025.
Regarding the timing of his price prediction, Kendrick stated: “It might take some time.” But I believe we can mount a strong campaign from, say, September to year’s end as we come closer to Trump’s election triumph.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
