Like the rest of the market, Bitcoin is faltering. A key level is now critical, or it risks a crash to $55,000.
Bitcoin is coming under pressure again – and with it the nerves of many investors. After a brief recovery last week, the price fell to a new five-month low of $74,436 on Monday. This brings the cryptocurrency dangerously close to its key technical level of $73,745.
If this level is broken, according to analyst Tyler Richey, a fall back to the $55,000-$57,000 zone is imminent – ​​a massive setback for the crypto bulls.
Even though the Bitcoin price has recovered somewhat in the meantime, the technical damage remains. With a nearly 28 percent gap to the all-time high of $109,225 on January 20, the euphoria surrounding the Trump election has long since faded.
CoinDesk analyst Andrew Baehr sees the current extreme market volatility as another negative factor. With a record VIX reading above 48, panic reigned on the stock markets on Monday – an environment in which investors tend to avoid risky assets like Bitcoin. This is also reflected in the trading volume. According to analysts at crypto research firm Kaiko, it has now fallen back to pre-election levels – around 45 percent below the November average.
Nevertheless, there are also bullish voices. BitMEX co-founder Arthur Hayes sees Bitcoin’s dominance rising to 70 percent in the coming months – currently, it stands at around 63 percent. He believes the withdrawal from altcoins and traditional financial assets will increase as distrust in established systems grows. “As long as the US Federal Reserve doesn’t print new money, Bitcoin remains the only attractive asset,” writes Hayes. For him, Bitcoin is the store of value of the future – censorship-resistant, decentralized, and global.
Hayes’ long-term forecast is as bold as it is clear: If confidence in the US dollar, US Treasuries, and central banks continues to crumble, Bitcoin could become a global financial anchor – with a price target of up to $1 million.
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