Warning Signs: Bitcoin on Brink of 33% Plunge – Will History Repeat Itself
Bitcoin Price Forecast: Potential Rise and Fall Following US Federal Reserve Interest Rate Cuts
According to a recent analysis, Bitcoin’s price could experience a brief surge followed by a sharp decline if the US Federal Reserve lowers interest rates. This prediction is based on historical trends, specifically the price fluctuations that occurred in 2019.
Cryptocurrency expert and engineer Apsk32 shared his insights on Twitter, citing the Federal Reserve’s interest rate cut in August 2019 as a precedent. He noted that Bitcoin’s price increased by 20% within a week of the rate cut but subsequently fell by 33% three months later.
On August 1, 2019, the Federal Reserve cut interest rates.
One Week Later: Bitcoin was up 20%.
Three Months Later: Bitcoin was down 33%.I think we could get a similar pop and drop, but I doubt we go down 33% from here. Bedrock between $45k-$55k and 2025 rewards the survivors. pic.twitter.com/6B5o4Jt93R
— apsk32 (@apsk32) September 4, 2024
Apsk32 expects a similar pattern to emerge if the Federal Reserve lowers interest rates this year. However, he doubts that Bitcoin’s price will fall by 33% and instead predicts a potential rise in 2025. His target price for Bitcoin is between $45,000 and $55,000.
Long-term Optimism about Bitcoin
Apsk32 is bullish on Bitcoin’s long-term prospects, predicting that the cryptocurrency will reach $2.6 million in the future. His forecast is based on Bitcoin’s market size and the “power law,” which has dominated the purchasing power of the Bitcoin market since 2011.
Asset management firm VanEck, which has over $100 billion in assets, shares Apsk32’s optimism. VanEck recently forecasted that Bitcoin’s price could reach $2.9 million by 2050, resulting in a total market size of $61 trillion. According to VanEck’s report, Bitcoin could handle around 10% of global international trade and 5% of domestic trade by 2050, with central banks holding 2.5% of their assets in BTC.
VanEck’s price target is based on a mid-scenario, with a worst-case scenario set at $130,000 and a best-case scenario set at $52.4 million.