Breaking News: Bitcoin Prices Plummet 30% to Multi-Month Low at $49,120 - What's Next for Crypto Investors?
In a shocking turn of events, Bitcoin prices have dropped a staggering 30% in just one week, hitting a multi-month low of $49,120 on Monday. This drastic decline comes after reaching a high of $70,000 on July 29, leaving investors reeling.
According to H.C. Wainwright, a leading investment firm, the sell-off in the crypto and equity markets can be attributed to three main factors: concerns about a potential hard landing for the U.S. economy, the unwinding of a popular global carry trade following the Bank of Japan's rate hike, and escalating geopolitical tensions in the Middle East.
"We foresaw this price correction and the pain may not be over yet," warned H.C. Wainwright. Back in mid-April, when Bitcoin was trading around $66,000, the firm predicted that the primary coin could retrace to the low-to-mid $50,000 range due to macro-related headwinds and geopolitical risks.
Despite remaining bullish in the medium- and longer-term, H.C. Wainwright remains cautious in the short term. The firm is worried about Bitcoin's increasing correlation to equities during times of stress, highlighting its status as a risk asset.
Looking ahead, any further weakening of economic data or escalating tensions in the Middle East could exert additional downward pressure on Bitcoin prices, according to H.C. Wainwright. The firm anticipates that the Federal Reserve may respond with rate cuts and looser monetary policy, potentially paving the way for Bitcoin to resume its upward trajectory in the next phase of this bull cycle.
Meanwhile, mining economics have hit all-time lows, with hash prices plummeting to $0.036 per terahash per day on Monday. H.C. Wainwright predicts that large public miners with better access to capital will continue to outperform smaller private peers, with CleanSpark standing out as their top pick for 2024 due to its scale, strong balance sheet, and low production costs.
In other news, Morgan Stanley has announced that it will allow its financial advisors to offer Bitcoin ETFs to certain clients starting this week. This move is expected to accelerate approvals at other major banks, potentially driving a re-acceleration of inflows into Bitcoin ETFs.
In conclusion, Bitcoin investors should brace themselves for continued volatility in the short term, with potential price fluctuations driven by economic data and geopolitical tensions. It is crucial to stay informed and monitor market developments closely to make well-informed investment decisions.