According to Huobi co-founder Jun Do, bitcoin is on its way to a bear market that might not recover until 2025.
Earlier this Friday, the exchange issued a report claiming that U.S. tapering will cause bitcoin’s price to fall in the following months.
Tapering
When the Federal Reserve reduces its acquisitions of new assets like bonds or mortgage-backed assets, it is known as tapering.
The decline in global liquidity is a consequence of tapering. Bitcoin’s value is expected to drop as a result of significant changes in liquidity.
A rise in interest rates will also put downward pressure on the prices of assets regarded to be riskier.
It’s incredibly impossible to anticipate accurately since there are many other things that can affect the market as well, Huobi co-founder Jun Do told CNBC. Geopolitical problems, such as conflict, or the current Covid situation may also impact the market.
According to this cycle, the very next bitcoin bull market will not arrive until the end of 2024 or early 2025.
Bitcoin Reached Its Peak In November
Bitcoin reached an all-time peak of about $69,000 in November, but has now lost momentum, and is now trading at around $37,000.
This year’s loss in Bitcoin corresponds with a global stock market decline of 8.8%. It is said that when more institutional money flows into digital assets, the price is becoming more interlinked with the traditional markets.
Last year, Bitcoin increased by 59.8%, while the overall market cap of all cryptocurrencies increased by 187.5%.
