After Bitcoin slump: Analysts fear a new “crypto winter”

Deepak Gupta January 20, 2022
Updated 2022/01/20 at 8:06 AM

Bitcoin is still the strongest cryptocurrency on the market. But Ethereum keeps catching up. Also the crash in Bitcoin rate doesn’t exactly help strengthen the asset. Instead, it could have far more far-reaching consequences than most investors assume. The US investment company Invesco, for example, predicts that we are currently heading for a new “crypto winter”.

Bitcoin rate soon below USD 30,000?

The market experienced the last such dry spell between the end of 2017 and the beginning of 2018. At that time, the Bitcoin price fell from around 20,000 to below 4,000 US dollars. Many investors lost interest in the digital asset at the time. It took the market some time to recover from this crypto winter. Something similar has happened over the past few months. The cryptocurrency fell from its record high of over 67,000 to below 40,000 US dollars.

“The mass marketing of bitcoin reminds us of stockbroker activity leading up to the 1929 crash. We think it’s not too far-fetched to imagine bitcoin falling below $30,000 this year.”

Paul Jackson, Global Head of Asset Allocation at Invesco
(via Business Insider)

If bitcoin price follows previous patterns, it would fall to between $34,000 and $37,000 by October. According to Jackson, a slide to below $ 30,000 cannot be ruled out. But the Invesco manager notes that this scenario is by no means certain. Only last year, the company assumed that the value of the cryptocurrency would fall below the USD 10,000 mark. “But instead it peaked at around $68,000,” Jackson said.

Which Bitcoin forecast is correct?

While Invesco and other independent analysts assume that the value of the currently strongest cryptocurrency on the market will continue to fall, others are still holding on to Bitcoin. For example, the pseudonymous market analyst PlanB is sticking to its forecast that the Bitcoin price will break 100,000 US dollars this year.

Meanwhile, the huge power consumption of the network casts a shadow over such prospects. It can therefore be assumed that Bitcoin could also have played a not insignificant role in the recent unrest in Kazakhstan. The government of Kosovo has already decided to introduce a ban on crypto mining. It sent Bitcoin price to its lowest level since September 2021 in early January.

Source: Business Insider

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