Is Bitcoin headed for a crash?

The Bitcoin bubble has already peaked, and the value of Bitcoin is likely to drop to around $30,000 by the end of this year – “Paul Jackson” (Head of Global Asset Allocation for Invesco).

According to investment management firm Invesco, the price of Bitcoin is expected to fall by more than 50% this year as the crypto bubble begins to burst. Paul Jackson, head of asset allocation at Invesco in 1929, compares the massive marketing of Bitcoin to that of stockbrokers in the 1920s before the Wall Street crash. Similar to the investment bubble of the 1920s, the value of bitcoin rose due to speculation without any fundamental basis.

Commenting on the rise in the price of Bitcoin since its inception, Jackson said: “Bitcoin was created to operate outside the control of the authorities, but if Bitcoin wanted to be part of the mainstream, it would have to comply with laws and regulations like all other financial instruments. “Bitcoin is like a flashing stock tick that only crypto enthusiasts see,” Jackson told Bloomberg. He adds that bitcoin needs proper regulation for investors to trust him enough to trade their fiat currencies for digital currencies; Otherwise, Bitcoin will never develop into anything more than an asset for speculators.

The current state of the cryptocurrency market

According to an Invesco study, Bitcoin does not provide any intrinsic return or value to support its price. Bitcoin has already fallen 40% from its peak, and Bitcoin is now in a bubble that will soon burst. By mid-May, the price of a single bitcoin had risen to nearly $63,000 from around $9,000 in July 2020. After dropping below $30,000 in July 2019, the value of bitcoin appears to have stabilized. The price of a single bitcoin rose to around $68,000 in November and has since fallen back.

Since Bitcoin does not offer dividends or interest rates, Bitcoin does nothing for traditional investors who seek a return to offset inflation. Bitcoin price volatility can lead to sudden drops as well as amazing spikes, making Bitcoin an unreliable store of wealth for those looking for income.

Compared to the report...

In late December, Goldman Sachs predicted that the price of Bitcoin would rise in 2022. According to Goldman Sachs analysis, the cryptocurrency could rise to $100,000 within five years as digital assets gain traction and displace gold as a byproduct of wider use. Goldman Sachs' findings contradict an Invesco report that predicted a massive decline in value. The results of both reports point to fundamental flaws in the cryptocurrency market, and it will be interesting to see what direction Bitcoin and other cryptocurrencies are taking.

“The digital asset market, on the other hand, is much bigger than bitcoin.” - Goldman Sachs

A really wealthy man named Mike Novogratz said that he thinks Bitcoin will be more valuable in the future. He said this because Bitcoin is still new and not many people know about it. In an interview with CNBC, he said that while the market is volatile over the next few weeks, he is not concerned about cryptocurrencies in the long term. “Some are coming” as the Fed becomes more bearish, according to longtime Bitcoin bull Novogratz.

According to him, cryptocurrencies are comparable to the early days of the Internet, when they were used only by technologists before expanding to a larger audience. Bitcoin has always been the most popular cryptocurrency in the market, but it is now being challenged by Bitcoin Cash and Bitcoin SV as well as a large number of other cryptocurrencies.

bottom line

At present, we are witnessing a downtrend in the entire cryptocurrency market and Bitcoin is also falling. The history of Bitcoin shows that Bitcoin has faced many price drops and the Bitcoin bubble has burst in the past. Bitcoin is sure to go up and down but Bitcoin is not over yet, Bitcoin may go down for some time but chances are Bitcoin will go up again!

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