One analyst is confident that bitcoin (btc) will be more resilient than ever in future crises. Taking X, the analyst saying that the world's most valuable currency will not fall below $100,000 in the next crypto winter.
bitcoin will be more resilient in the future
This optimistic outlook depends on one key factor: the recent approval of spot bitcoin exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC). This product, the analyst said, represents a significant change, introducing a “permanent institutional offer” for bitcoin.
Now that Wall Street is open to diversifying into bitcoin, aiming to follow the trend, the flow of institutional demand would make the currency more robust even if prices overheat in the future.
The analyst maintains that this “permanent” demand is a powerful buffer against price declines. While future bear markets are inevitable, the presence of institutional buyers will reduce the severity and duration of these downturns.
Consequently, the analyst expects future corrections to be relatively shallow and recoveries to be stronger and faster. btc losses were deeper in the past and recoveries were weaker due to low liquidity.
This prediction is when bitcoin is in an uptrend, looking at the performance on the daily chart. So far, the coin is hovering around the January 2024 highs and will likely extend the gains. Looking at the candlestick layout, the immediate psychological resistance is $50,000.
If the bulls anchor the recent bullish leg, btc prices may surpass this reaction point, starting a run that may float btc to November 2021 highs in 2021.
Will btc surpass $70,000 in 2024?
Although the analyst is optimistic, it is not immediately clear whether bitcoin would even have the momentum to break above $70,000 and reach new territory above $100,000. Still, more analysts and investors, including Arthur Hayes, co-founder of BitMEX, remain optimistic.
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According to Hayes, the monetary policy decisions made by the United States Federal Reserve (Fed) will shape and determine the level of market liquidity and therefore the speed of btc's bullish trend. The Federal Reserve is expected to reduce its interest rate from the current level of 5.50% to a new level in March.
If the central bank continues to adjust its policies, defy economists' forecasts and suck liquidity from the market, bitcoin could suffer as it did in 2022. However, with Wall Street involved and more capital flowing into bitcoin, future corrections, even if the prices are still below all-time highs, it might not be as brutal as before.
Featured image of DALLE, TradingView chart
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