As the Federal Reserve (FED) prepares for an impending interest rate cut, discussions within the cryptocurrency community have surged regarding its potential impact on Bitcoin, the largest crypto asset by market capitalization. A prominent crypto analyst has drawn parallels to past scenarios, particularly focusing on the events of 2019, to predict future price movements.
An Impending Pop and Drop Performance for Bitcoin
A renowned crypto expert and engineer, Apsk32, has provided insights into Bitcoin’s price performance following the anticipated FED interest rate cut set for September 18. The analyst forecasts that Bitcoin might exhibit similar price trends in 2024 as those observed in 2019 after the FED reduced interest rates.
In August 2019, following a FED interest rate cut, Bitcoin experienced a notable surge of approximately 20% within a week. However, this bullish momentum was short-lived, as the digital asset plummeted by over 33% within three months, leading to a wave of pessimism in the industry. Drawing comparisons between the two periods, Apsk32 suggests that if the FED opts for monetary easing this year, Bitcoin might undergo a similar pattern of initial bullishness followed by a significant drop.
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While Apsk32 anticipates a potential “pop and drop” scenario for Bitcoin, he remains uncertain about the extent of the decline. Consequently, he has set a base price range for Bitcoin between $45,000 and $55,000 before expecting a more substantial rally in 2025, a year he believes holds promise for the cryptocurrency market.
Apsk32’s bullish long-term outlook for Bitcoin is evident from his previous audacious forecast, envisioning a $2.6 million per BTC valuation in the future. This projection is grounded in the digital asset’s market capitalization, which aligns with a power law observed since 2011. If this pattern persists, Bitcoin’s value could reach $2.6 million within the next decade.
A Wave of Bullish Predictions for Bitcoin
Apsk32’s optimism is mirrored by prominent asset management company VanEck, which has similarly projected a substantial long-term valuation for Bitcoin. In its latest report, VanEck anticipates Bitcoin reaching a value of $2.9 million by 2050, translating to an overall market capitalization of an astounding $61 trillion.
VanEck’s prediction is based on the premise that Bitcoin could potentially facilitate around 10% of global international trade and 5% of domestic trade by 2050. This scenario could lead central banks to allocate approximately 2.5% of their assets in Bitcoin. It is important to note that VanEck’s $2.9 million price target represents the firm’s base case scenario, with the worst and best-case scenarios pegged at $130,000 and $52.4 million, respectively.
As of now, Bitcoin is trading at $55,902, reflecting the ongoing market dynamics and investor sentiment.
