Українська
Русский
English
Bitcoin could fall further before capitulating at $50K — “Godfather of Crypto”
Bitcoin stabilized around $72,000 on Thursday, trading above that level for the first time in roughly a month after a broad rally lifted cryptocurrency markets and related stocks the day before.
The world’s largest cryptocurrency rose more than 6% on Wednesday, recovering after spending most of the previous several weeks trading below the $70,000 mark.
The move brought Bitcoin closer to regaining its status as a geopolitical hedge amid ongoing tensions in the Middle East.
Part of the rally was driven by renewed institutional demand. Spot Bitcoin exchange-traded funds attracted about $1.1 billion in net inflows over three trading sessions from March 2 to March 4, according to data compiled by ETF trackers including Farside Investors and CoinGlass.
The inflows mark a reversal after weeks of outflows earlier this year that had pressured sentiment around the asset. On March 4 alone, spot Bitcoin ETFs recorded roughly $461.9 million in net inflows, with BlackRock’s IBIT (NASDAQ: IBIT) accounting for $306.6 million of that total, CoinGlass data show.
Despite the recent rebound, Bitcoin had declined for five consecutive months from October through February, marking its longest losing streak in years.
Following that downturn, Investing.com spoke with American entrepreneur and cryptocurrency investor Michael Terpin to discuss the forces currently driving the market and where the world’s largest cryptocurrency may head in the coming months.
Terpin, one of the early thought leaders in the Bitcoin and crypto space, was dubbed the “Godfather of Crypto” by CNBC for his advisory and marketing work on many early projects in the industry.
1) To what extent are macroeconomic forces behind Bitcoin’s recent weakness?
“The main driver of the four-year cycle is the prolonged effects of the halving. In every cycle so far, Bitcoin has behaved quite predictably — reaching a new all-time high within about seven months after the halving, then seeing that bubble burst over the following 11 months, which begins a slow, painful price decline that ultimately capitulates about a year later.”
“Macroeconomic forces so far have mostly accelerated moves or cut off the top, but they haven’t had much impact on the bottom, which usually arrives after a notable bankruptcy or failure rooted in excessive leverage by major institutions — whether it was Mt. Gox in 2014 or FTX in 2022.”
2) ETF flows were a major tailwind earlier in the cycle. What are you seeing now in terms of institutional demand, and what are the prospects for institutional participation in the future?
“ETFs partly mimicked first-generation retail buyers in that they tended to sell near the top. But there are also professional traders using ETFs for additional leverage, and institutions like Harvard buying their Bitcoin in ETF form. So there shouldn’t be the kind of panic selling at the bottom that we always saw with new retail investors.”
3) Bitcoin fell about 15% in February, marking its longest losing streak in years. Should investors brace for further weakness in the coming months?
“Indeed, February marked five consecutive months of losses, many of them in double digits. The history of the four-year cycle has shown a similar pattern after the bubble bursts. But in every other cycle, March was a positive month, so it’s reasonable to expect that March — which has already begun with upward momentum — will end up positive.”
“However, the bottom has likely not yet been reached, and I expect April to be another negative month, with the final bottom of this correction at least 60% below the bubble peak, which would bring us down to roughly $50,000 at capitulation.”
4) Where do you think Bitcoin will trade by the end of the year?
“The path of least resistance is toward lower lows before capitulation around $50K. Bad macroeconomic news — especially crypto-related developments such as the bankruptcy of a major fund or exchange — could push it down to $40K by early fall.”
“The road back up is slow, so I don’t see Bitcoin being much higher than $80K–$100K by the end of the year. But it should be on its way to much larger gains in 2027, 2028, and 2029, until the next bubble bursts.”
“At that point it will all be about the supply shock. If demand remains moderate, it will be difficult to push above $200K. But if the next bull market brings renewed interest and FOMO, Bitcoin could surge above $300K or even $400K.”
“I still believe Bitcoin will reach $1 million by 2037, just not in a straight line.”
See also: "Opinion: Strategy’s $76,000 average purchase price is a psychological barrier for bulls"
