Bitcoin price: Binance boss predicts crypto could stay below peak for two years

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The boss of one of the world’s most pop­u­lar cryp­tocur­ren­cy plat­forms has made a pun­ish­ing two-year pre­dic­tion for bitcoin.

The boss of one of the world’s most pop­u­lar cryp­tocur­ren­cy plat­forms has pre­dict­ed that bit­coin will not sur­pass its all-time high for at least anoth­er two years.

The world’s most recog­nis­able dig­i­tal asset was trad­ing at around $US69,000 ($A99,000) in Novem­ber, but it – along with pret­ty much every oth­er cryp­tocur­ren­cy – has plum­met­ed in val­ue in recent months.

It has seen its val­ue drop to below $US18,000 ($A25,300) this month, as glob­al mar­kets in gen­er­al took an absolute ham­mer­ing amid soar­ing infla­tion, ris­ing inter­est rates and fears of a US reces­sion in the com­ing year.

Bit­coin has bounced back from it’s 52-week low to $US20,707 ($A30,027) as of 8am today.

Despite the hard times being felt by cryp­to traders, Chang­peng ‘CZ’ Zhao, the founder and chief exec­u­tive of Binance, said that any­one who invest­ed in the dig­i­tal assets just four years ago would still be “very hap­py” with their return.

How­ev­er, in an inter­view with The Guardian, he pre­dict­ed that it would take years before bit­coin reached the highs it saw last November.

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“I think giv­en this price drop, from the all-time high of $US68,000 to $US20,000 now, it will prob­a­bly take a while to get back. It prob­a­bly will take a few months or a cou­ple of years,” Mr Zhao told the Guardian, adding: “No one can pre­dict the future.”

He went on: “$US20,000 we think is very low today. But you know, in 2018, 2019, if you told peo­ple bit­coin will be $US20,000 in 2022, they would be very hap­py. In 2018/19, bit­coin was $US3000, $US6000.”

He said it was “nor­mal” for bit­coin to fluc­tu­ate as it has.

“If you look at the bot­tom [of bit­coin], right now it’s high­er than the last peak. So, whether nor­mal or not, I think with the indus­try still def­i­nite­ly grow­ing, fluc­tu­a­tions in price is nor­mal,” he said.

Fears of glob­al reces­sion spark panic

For the entire year, cryp­tocur­ren­cy has been endur­ing a bear run.

How­ev­er, last week­end things took a turn for the worse as investors pan­icked fol­low­ing the US cen­tral bank hik­ing the inter­est rate by 75 basis points.

This was in response to soar­ing infla­tion – the lat­est May fig­ures puts US infla­tion at 8.6 per cent, the worst it’s been since 1981.

It prompt­ed fears of a glob­al reces­sion and cryp­to investors quick­ly retreat­ed, caus­ing a mass sell-off and a dras­tic drop in price for some of the world’s top-ranked blockchains.

At its low­est, the num­ber one cryp­tocur­ren­cy, bit­coin, fell to $US17,601.58 ($A25,300) on Sun­day morning.

That’s a big drop when you con­sid­er that at the start of last month, bit­coin was trad­ing at $US36,141.33 ($A52,000), accord­ing to CoinMarketCap.

In fact, its low­est price over the last few weeks rep­re­sents a whop­ping 74 per cent dip in val­ue since its Novem­ber peak.

Now, all bitcoin’s gains over the last two years of the pan­dem­ic have pret­ty much been wiped – BTC hasn’t been this low since Octo­ber 2020.

Although cryp­tocur­ren­cies have weath­ered sev­er­al win­ters and fluc­tu­a­tions in price, one bank­ing pro said this one was the most extreme, giv­en how wide­ly used blockchain is now.

Irfan Ahmad, of State Street Dig­i­tal in the Asia Pacif­ic region, told the Aus­tralian Finan­cial Review: “This is the first time bit­coin and oth­er cryp­tocur­ren­cies have gone through such an infla­tion­ary environment.

“It is the fourth cryp­to win­ter and the most severe giv­en wider adop­tion – we are refer­ring to it as a polar vor­tex”.

That said, Mr Ahmad believes some of the most promi­nent dig­i­tal tokens like bit­coin and ethereum will sur­vive the winter.

“But as far as an asset class is con­cerned, we think [cryp­to] is here to stay,” he told the publication.

“There is going to be an evo­lu­tion of the play­ers and the pro­to­cols in the market.”

Read relat­ed top­ics:Cryp­tocur­ren­cy

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