Standard Chartered Bank says the price of bitcoin could drop to $5,000 next year. The bank’s analyst explained that cryptocurrencies could fall further and more crypto firms could “succumb to liquidity squeezes and investor withdrawals.”
Standard Chartered Bank’s $5K Bitcoin Scenario
Standard Chartered Bank published a note on Sunday titled “The financial-market surprises of 2023”. The note outlines several possible scenarios, which “we think are undervalued by the market,” wrote Eric Robertson, global head of research at Standard Chartered.
One of the scenarios is bitcoin’s price dropping to $5,000 next year, which would be about a 70% drop from BTC’s current price of around $17,000.
Robertson elaborated:
Yields decline along with tech stocks, and while the bitcoin sell-off has taken off, the damage has been done. More and more crypto firms and exchanges found themselves with insufficient liquidity, leading to further bankruptcies and a collapse of investor confidence in digital assets.
The Standard Chartered analyst clarified that the extreme scenarios outlined “have a non-zero probability of occurring in the year ahead, and … fall materially outside of the market consensus or our own baseline views.”
Noting that cryptocurrencies “could fall further” and more crypto firms “could succumb to the liquidity squeeze and investor withdrawals,” Robertson said gold could rise 30% to $2,250 an ounce and establish itself as a safe-haven. Can reinstall as. he told:
The 2023 resurgence in gold comes as equities resume their bear market and the correlation between equity and bond prices shifts back to negative.
Commenting on Standard Chartered Bank’s $5K bitcoin price outlook, gold bug and economist Peter Schiff reiterated his prediction that BTC is about to decline further. He tweeted on Monday:
Bitcoin has far more downside risk than 70%. After such a decline bitcoin will still be way over-priced, so $5,000 will not even be close to the bottom.
Recently, veteran investor Mark Mobius said that bitcoin could drop to $10,000 next year as the Federal Reserve continues to raise interest rates and tighten monetary policy.
However, some people are still optimistic about the price of bitcoin. Venture capitalist Tim Draper, for example, has doubled down on his BTC price prediction of $250,000 by the middle of next year.
