By Marco Uhrl
Investing.com – Encountered, Ethereum and its analogues. A period of drought that has lasted for more than a year, after a long time since it was trading in the range of all-time highs.
It was the Fed’s monetary tightening that caused stocks and cryptocurrencies to fall in equal measure. However, cryptocurrencies have been particularly hard hit, as the collapse of Terra threatened the entire cryptocurrency environment in May. At that point, it was assumed there could be nothing worse.
But the great savior, Sam Bankman-Fried, who backed troubled projects with triple-digit millions, himself made some mistakes while juggling billions. The mistakes that caused the collapse of his empire and permanently undermined confidence in the crypto industry. His multi-billion dollar projects have also included some institutional investors who must now write off their holdings.
Even Bitcoin advocates like Galaxy Digital CEO Mike Novogratz have now had to scale back their predictions for the future of this market.
Less than six months ago, Novogratz predicted that Bitcoin would reach the magic limit of $500,000 within the next five years. Not even Terra’s collapse would have dissuaded him from sticking to that price target.
But the FTX crisis changed everything, so as today, he backed away from those predictions. He remains confident that BTC will reach $500,000, but not in the next five years.
Mark Mobius, founder of Mobius Capital Partners, believes that bitcoin still has tough times ahead. As reports of a possible bottom are piling up, he believes that BTC is likely to test $10,000 in 2023.
That’s because holding cryptocurrencies has become less attractive with the collapse of FTX. In times of low central bank interest rates, cryptocurrency yield projects promising returns of 5% or more for holding cryptocurrencies have flourished. It is however, that an ecosystem that was based in large part on TX now seems doomed.
“Of course there have been a number of offers of interest rates of 5% or higher for digital deposits, but many of those companies offering such rates have been pushed back partly as a result of what happened with FTX,” Mobius said. “So, as these losses mount, people are afraid to hold. in cryptocurrency in order to earn interest.”
Important technical levels for Bitcoin
Bitcoin is currently down -0.77% after the BTC/USD pair reached $16,953, while the weekly gain is 3.01%.
The digital currency failed to confirm its rally on November 30 above the 23.6% Fibonacci level, after seeing yesterday’s daily close just below $16,986. Thus, the market appears to be set for more losses, which means that the November 21 low at $15,504 is expected to be tested.
Only if the price can sustain a sustained rise above the 23.6% Fibonacci retracement level can it target the 38.2% Fibonacci retracement level at $17,841, the 55-day moving average at $18,424, and the 50% Fibonacci retracement level at $18,533.