The widespread adoption of Bitcoin globally reflects a growing appetite for an alternative, more reliable store of value over the long term, as many governments gradually erode the value of their respective fiat currencies.
Chris Wood of Jefferies suggests that despite short-term volatility, Bitcoin’s price trajectory will stabilize over time as it gains broader acceptance.
Following the anticipated Mt.Gox repayment that commenced on Friday, Bitcoin (BTC) experienced heightened price swings. The flagship cryptocurrency briefly dipped to $53,898 before rebounding above the critical $56,000 support level at the time of writing.
This increased volatility in Bitcoin, comparable to the recent FTX incident, triggered substantial liquidations across crypto markets in the past 24 hours, leading to a notable surge in fear. Moreover, the fear and greed index plummeted from 44 (neutral) to around 29 (fear) over the same period, driven by significant sell-offs in the secondary market, notably by institutional traders such as the German government.
Bitcoin Stands to Gain from US Dollar Weakness
According to Chris Wood, Chief Strategist at Jefferies in New York, Bitcoin’s mainstream adoption is inevitable amid ongoing weaknesses in fiat currencies. Wood recently communicated to investors that Bitcoin should be seen as long-term insurance within investment portfolios, rather than a short-term trading asset. Wood remarked:
“The decision to include Bitcoin reflects its role as a viable alternative for risk-averse capital seeking a stable store of value, particularly given the growing evidence of currency devaluation policies among G7 nations over the past two decades.”
Wood also points out that Bitcoin’s increasing adoption worldwide, particularly in contrast to the US dollar and other fiat currencies, is largely driven by concerns over poor monetary policies, as consistently highlighted by Crypto News Flash. The rise of the BRICS alliance has posed a notable challenge to the global dominance of the US dollar, traditionally bolstered by G7 nations.
As more multinational corporations and investors embrace Bitcoin and other cryptocurrencies for efficient cross-border transactions, the supremacy of the US dollar in global finance is expected to diminish in the coming years.
Will the Bull Market Return?
Crypto analyst PlanB remains optimistic that the Bitcoin bull market is progressing on schedule, despite prevailing midterm pessimism. Similarly, an analyst from Matrixport foresees a continued rally in Bitcoin prices leading up to the US general elections.
Furthermore, with expectations of the Federal Reserve reducing its benchmark interest rate later this year amidst declining inflation, coupled with ongoing effects from the fourth Bitcoin halving, there is a strong indication that the crypto bull run is far from over and is poised to resume soon.
Midterm BTC Price Predictions
From a technical viewpoint, Bitcoin’s price has been consolidating over the past four months since reaching its all-time high (ATH) of approximately $73,000. According to crypto analyst Mustache on the X platform, Bitcoin is likely to rebound and achieve a new ATH in the coming weeks.
“I may be among the few remaining bulls, but I’m confident the bull market isn’t over yet. Corrections are natural, and trying to time the exact bottom is futile. I’ve seen this pattern before.”
For further reading:
– Bitcoin Buying Guide
– Bitcoin Wallet Setup Tutorial
– Real-time Bitcoin Price Updates
– Latest Bitcoin Developments
– What Exactly is Bitcoin?
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