A leading crypto expert warns that the overall market value of Bitcoin and the altcoin market could collapse. The worrying predictions are based on the Fed’s hawkish stance and the contraction in the stock market.
Nicholas Merten warns Bitcoin investors against 50% decline
In his latest assessment to his 512,000 YouTube followers, popular DataDash host Nicholas Merten claims that the total crypto market cap (TOTAL) could drop by $440 billion from its current value. What is concrete behind these bold predictions of the analyst?
Nicholas Merten states that Bitcoin could decline by more than 43% from its current price. “The best-case scenario for those taking positions now is for market capitalization to find support in the region of around $650 billion, or for Bitcoin to stabilize in the $15,000-16,000 band,” he adds.
When we started writing, the total market value of the crypto market is around $1.092 trillion. Bitcoin price is also at $26,584. The leading crypto is down 0.8% compared to the last week.
Fed pressure and decline in the stock market
Merten bases these predictions on the Fed’s constantly tightening policies. This also weakens the performance of stocks. While stocks of major technology companies, especially giants like Microsoft or Apple, are falling, bond yields are rising and the dollar is becoming scarcer. Merten raises questions about what these changes might do to crypto in a world of increasing uncertainty and volatility. Does he really think people will turn to the price of Bitcoin? The analyst says this about this:
I understand the argument that with Bitcoin’s halving event and limited supply, people will gravitate towards Bitcoin. But ultimately, we observe that Bitcoin sees its best performance not in periods of monetary contraction, but in periods of new money and credit creation.
Merten’s Bitcoin analysis both makes investors and crypto enthusiasts think and warns them to be cautious. As a result, the crypto market has always been full of unpredictable fluctuations. Such analyzes are important for investors to make informed decisions.
Analysis of Bitcoin’s course after the FED meeting
Bitcoin has experienced a significant amount of selling pressure in the last few weeks. Most of the selling pressure was due to concerns that the Fed could possibly raise interest rates. Fast forward to today and it has been over 24 hours since the Fed made its announcement. The monetary authority announced that it will keep the benchmark interest rate between 5.25% and 5.50%. In other words, interest rates will remain unchanged, contrary to concerns about a possible interest rate increase. As Kriptokoin.com, we included the first reaction of the Bitcoin price to the statements of Fed Chairman Powell in this article.
The Fed has kept the benchmark interest rate unchanged in the range of 5.25%-5.50%, in line with market expectations.
WSJ：12 officials pencil in one more hike this year; 7 are ready to pause. The median participant projects two cuts in 2024. https://t.co/azBKxgRjqH
— Wu Blockchain (@WuBlockchain) September 20, 2023
Despite the FED’s decision not to increase interest rates, Bitcoin price performance has generally trended downward in the last 24 hours. This rise was contrary to expectations. The selling pressure was triggered after the price interacted with the 50-day moving average following the previous rally. Meanwhile, Bitcoin addresses with at least 1,000 BTC recently dumped some of their crypto, adding to the selling pressure.
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