Wall Street analysts face an almost impossible task when trying to predict the route taken by Bitcoin, writes Bloomberg. A team of strategists led by Nikolaos Panigirtzoglou, a senior member of banking giant JPMorgan, says the Bitcoin selloff has not yet come to an end.
Meanwhile, investment bank Goldman Sachs reports that the decline in recent weeks has raised questions for institutional investors, and financial intelligence agency Medley Global Advisors has warned that Bitcoin could fall below the $ 20,000 threshold.
“It is too early to declare an end to the declines in Bitcoin,” JPMorgan analysts say, citing a lack of Bitcoin funding and regulated futures contracts.
The cryptocurrency market has lost $ 1 trillion
The world’s most valuable cryptocurrency rose 9 percent to $ 36,800 on Monday, after a weekend that brought digital assets to 40 percent below a record a month ago.
The crypto market has suffered a series of setbacks in recent weeks, largely due to criticism by Elon Musk of the huge amount of energy needed to mine Bitcoin and the Chinese authorities’ new series of regulations.
Recently, the Bloomberg Galaxy Crypto index, which includes Bitcoin and other cryptocurrencies, collapsed by 40%, the worst result since the beginning of the pandemic. At the same time, the value of virtual currencies fell by about $ 1 trillion, from a high of $ 2.6 trillion this month.
A report by blockchain analysis firm Chainalysis shows that in the last 12 months, $ 110 billion was spent to buy Bitcoin at an average price of $ 36,000 per currency. Thus, the vast majority of investments fail to make a profit if the currency is not traded at more than $ 36,000.
In the last year, more than $ 200 billion has been spent globally to buy Bitcoin, more than half of the total money thrown to the cryptocurrency. In mid-April, Bitcoin traded at nearly $ 65,000.
Ben Emons, managing director of Medley Global Advisors, says the possibility of a drop below the $ 20,000 threshold cannot be “ruled out.”
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