The widespread adoption of Bitcoin worldwide reflects a growing preference for an alternative and more secure store of value as many governments continue to gradually devalue their respective fiat currencies.
Chris Wood of Jefferies suggests that while short-term volatility in Bitcoin prices may persist, the long-term outlook remains robust due to increasing mainstream acceptance.
Following the commencement of the highly anticipated Mt.Gox repayment on Friday, Bitcoin (BTC) experienced heightened price fluctuations. The flagship cryptocurrency dropped to as low as $53,898 earlier in the day but subsequently rebounded above the critical support level of approximately $56,000 at the time of reporting.
This increased volatility in Bitcoin led to substantial crypto liquidations in the past 24 hours, akin to the FTX collapse, causing a notable spike in fear. Furthermore, the fear and greed index plummeted from 44 (neutral) to around 29 (fear) over the same period, influenced by significant sell-offs in the secondary market, led by notable whale traders like the German government.
Bitcoin Set to Gain from US Dollar Weakness
Chris Wood, Chief Strategist at Jefferies, asserts that Bitcoin’s mainstream adoption is inevitable amidst the decline of fiat currencies. Wood recently communicated to investors that allocating Bitcoin in investment portfolios should be seen as long-term insurance rather than a short-term speculation. He remarked:
“The decision to allocate to Bitcoin is driven by its role as a legitimate alternative for risk-averse capital seeking a store of value, especially given the mounting evidence over the past two decades of currency devaluation policies in the G7 nations.”
Wood attributes the growing acceptance of Bitcoin versus the US dollar and other fiat currencies largely to unsound monetary policies. As highlighted by Crypto News Flash, the rising prominence of the BRICS nations poses a significant challenge to the global dominance of the US dollar supported by G7 member states. Consequently, an increasing number of global corporations and investors are embracing Bitcoin and other cryptocurrencies for seamless cross-border transactions, signaling a potential decline in global US dollar supremacy in the coming years.
Will the Bull Market Resume?
Despite growing midterm pessimism, popular crypto analyst PlanB believes that the Bitcoin bull market remains on track. Similarly, an analyst from Matrixport predicts continued upward momentum in Bitcoin prices as the US general elections approach.
Moreover, with expectations of the Federal Reserve lowering its benchmark interest rate later this year amidst easing inflation, coupled with the ongoing impact of the fourth Bitcoin halving yet to be fully priced in, indications suggest that the crypto bull market is not over and is poised to resume soon.
#Matrixport
MoT Research – Jul 5: Summer Consolidation Despite Political and Macro Tailwinds
#BTC
#ETH
#Elections2024
#CryptoFinance
#cryptocurrency
pic.twitter.com/gaYwJZAulp
— Matrixport Official English (@Matrixport_EN)
July 5, 2024
Midterm Bitcoin Price Outlook
From a technical perspective, Bitcoin’s price has consolidated over the past four months after peaking at its all-time high (ATH) of approximately $73,000. According to prominent crypto analyst Mustache on the X platform, Bitcoin’s price is anticipated to rebound and reach a new ATH in the coming weeks.
#Bitcoin
“I may still be one of the few bulls out there, but I remain confident the bull market isn’t over yet.
Corrections happen, and no one times the exact bottom, so all this negativity is unwarranted.
btw. I’ve seen this pattern before.
pic.twitter.com/w0cbEiFX0I
— ⓗ (@el_crypto_prof)
July 5, 2024
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