Bitcoin faces potential plunge as Standard Chartered issues warning
- Bitcoin may fall to the low $80,000s if it drops below $90,000, according to Standard Chartered.
- Concerns about macro risks and market volatility are influencing this bearish outlook.
- Despite the potential downturn, analysts suggest this is a medium-term buying opportunity.
In the wake of ongoing market volatility, Bitcoin's price has come under significant scrutiny, with analysts at Standard Chartered expressing concerns regarding a downturn. The cryptocurrency could potentially fall to the low $80,000s if it decisively breaks below the critical threshold of $90,000. This evaluation arises amidst macroeconomic uncertainties exacerbated by expectations surrounding the incoming Trump administration. The 13th of January 2025 saw Bitcoin's price slip to around $90,000, heightening fears of forced selling from major holders like spot ETFs and MicroStrategy. Their average purchase price hovers around $94,000, indicating that they are merely breaking even on their investments. As Standard Chartered highlights, the recent market trend raises alarms about a potential self-fulfilling sell-off. This worrying scenario is spurred by several macroeconomic factors, including the anticipation of upcoming U.S. CPI data. The report underscores the danger of a proper break below the $90,000 mark, suggesting that it could add to the selling pressure in the near term, allowing Bitcoin to further decline by approximately 10% toward the low $80,000s. Nevertheless, Geoffrey Kendrick from Standard Chartered views such a price drop as a buying opportunity for long-term investors. He advocates for accumulating long positions after the market turbulence settles, maintaining an optimistic long-term outlook that sets a price target of $200,000 by the end of 2025. This bullish perspective relies on the expectation that institutional investments will ramp up under the new administration. The analysis provided by Standard Chartered indicates that while there are significant risks in the current Bitcoin market, the potential for recovery and growth remains intact. The firm's reiteration of its long-term bullish stance amidst the observed volatility shows their confidence in Bitcoin's ability to rebound, as long as institutional interest resumes in the coming years.