Community economist Timothy Peterson warns that if the US Federal Reserve holds off on fee cuts in 2025, it might trigger a broader market downturn, doubtlessly dragging Bitcoin again towards $70,000.
“What it wants is a set off. I believe that set off could also be so simple as the Fed not chopping charges in any respect this 12 months,” Peterson stated in a March 8 X publish. Peterson’s remark comes only a day after Federal Reserve chair Jerome Powell reiterated that he is in no hurry to regulate rates of interest.
Fed fee lower delay might spark bear market
“We don’t must be in a rush and are well-positioned to attend for higher readability,” Powell stated in a speech in New York on March 7.
Supply: Timothy Peterson
Peterson, who’s the writer of the paper “Metcalfe’s Legislation as a Mannequin for Bitcoin’s Worth,” estimated how low the Nasdaq might fall to foretell Bitcoin’s (BTC) potential backside in “the subsequent bear market.”
Utilizing Peterson’s Nasdaq lowest value ahead mannequin, Peterson estimated that the underside would take about seven months to type, with the Nasdaq dropping 17% over the interval.
Making use of a “1.9” occasions multiplier to that quantity for Bitcoin’s decline, he estimated a 33% decline in Bitcoin, bringing it all the way down to $57,000 from its present value at publication, $86,199, in response to CoinMarketCap information.
Supply: Timothy Peterson
Nevertheless, he stated Bitcoin doubtless gained’t drop that far, anticipating a backside nearer to the low $70,000 vary primarily based on historic traits from 2022.
“Merchants and opportunists hover over Bitcoin like vultures,” he stated, explaining that after the market expects Bitcoin to hit $57,000, “it gained’t get there as a result of there are all the time some traders who step in as a result of the worth is ‘low sufficient.”
Bitcoin’s 2022 low didn’t drop as anticipated
“I keep in mind in 2022 when everybody stated the underside could be $12k. It solely went to $16k, 25% larger than anticipated,” he stated earlier than declaring that the 25% improve from $57,000 is $71,000.
The final time Bitcoin traded on the $71,000 value stage was on Nov. 6, after Donald Trump gained the US election, earlier than rallying for a month and reaching $100,000 by Dec. 5.
Associated: Bitcoin traders share blended reactions to White Home Crypto Summit
In January 2025, BitMEX co-founder Arthur Hayes echoed an analogous value prediction.
“I’m calling for a $70k to $75k correction in BTC a mini monetary disaster, and a resumption of cash printing that may ship us to $250k by the top of the 12 months,” Hayes stated in a Jan. 27 X publish.
In December 2024, crypto mining agency Blockware Options stated Bitcoin’s “bear case” for 2025 could be $150,000, assuming the Federal Reserve reverses course on rate of interest cuts.
Journal: Meet lawyer Max Burwick — ‘The ambulance chaser of crypto’
