The Bitcoin sell-off is over – but a quiet year may lie ahead
Fundstrat's Tom Lee sees BTC closing out 2022 at current levels after having previously predicted a surge to AUD$280K (US$200K).
- MicroStrategy CEO Michael Saylor claims his company will continue to accumulate during this ongoing lull.
- Arthur Hayes, ex-CEO of cryptocurrency exchange BitMEX, believes BTC has reached a local bottom with things only looking up from here.
- Bitcoin's total market capitalisation currently stands at AUD$810 billion (US$575 billion).
For nearly a month running, Bitcoin has stayed range bound between AUD$38,000–AUD$45,000. The digital asset's yearly losses now stand at -19% while trading at AUD$42,461.
Since rising to AUD$44,500 48 hours ago, Bitcoin has been descending slowly, staying in line with the news of the United States Federal Reserve scaling down its US$9 trillion balance sheet. BitMEX's former CEO Arthur Hayes believes that the digital asset has achieved its local bottom — a price below which an asset cannot drop further in the foreseeable future — stating that if the currency stays above AUD$35,000 (US$25,000), it will surge once again.
In a recent interview, Tom Lee, co-founder of independent research firm Fundstrat, stated that he is not sure if BTC will be able to close out the year with any sort of major positive momentum, adding:
"It's a risk-on asset, so I think to the extent that Nasdaq and Bitcoin rally, it's helping us become more comfortable that the market's already bottomed. I think Bitcoin's going to make its way to flat for the year, possibly up."
Lee had predicted back in November 2021 that Bitcoin would close out 2022 at US$200K or higher. Crypto bull MicroStrategy CEO Michael Saylor believes that the naysayers have been proven wrong time and again about BTC's future price action, adding: "The deniers are wrong and the sceptics are wrong. It's not going to zero, it's going to a million."
Some experts are of the view that Bitcoin's next major price recovery will only take place after its next halving, which is slated to take place in 2024. Consequently, Saylor sees this as being the right time to accumulate the crypto at discounted prices, stating:
"We're kind of doing the equivalent of dollar cost averaging for a large corporation. We're not trying to time the market; I think all the statistics on the S&P and on the Bitcoin index show you can't time the market. We're just reinvesting free cash flows in the market as circumstances allow us."
Bitcoin's future looks quite lacklustre
Investor optimism may remain damp as the US Commodity Futures Trading Commission (CFTC) recently filed a lawsuit against the Winklevoss-owned Gemini Trust Co. for allegedly issuing misleading statements back in 2017 about its offerings. As per the regulatory agency, the company released inaccurate info regarding the self-certification evaluation of one of its Bitcoin futures contracts.
Earlier this week, the Russian parliament introduced a new bill seeking to ban digital assets as a means of payment, stating any transactions made using cryptocurrencies needed to be recognised by the country's local payment system, as well as duly passed by the Russian central bank registry.
Disclosure: The author owns a range of cryptocurrencies at the time of writing
Trying to get a handle on the markets? Cut through the noise with our overview of the best cryptos to buy right now, explore some strategies for how to trade crypto or see if there's a better platform for you with our guide to the best crypto exchanges.
Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.
