Bitcoin Halving Is Not a Bullish Event, Says 10x Research Analyst

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Bitcoin might drop to as little as $50,000 over the subsequent few weeks because the macroeconomic uncertainty looms over the crypto market, mentioned Markus Thielen, co-founder of 10x Analysis.

Even the halving, which takes place on Saturday, may not drive the value of bitcoin up as many of the worth motion after earlier cycles was pushed by a greater macro atmosphere.

Bearish alerts are looming over the crypto market today and can virtually actually push costs down within the brief time period, well-known analysis analyst Markus Thielen mentioned.

Thielen, who has beforehand predicted many bull and bear rallies in crypto, presently sees no catalysts that will convey costs up once more, he mentioned on CoinDesk’s Markets Each day podcast.

“We do not have the everyday drivers anymore that basically introduced costs from the $40,000 to the $70,000 area,” he mentioned. The primary motive behind this, he added, is the spot bitcoin ETFs, which have seen little to no new inflows over the previous few weeks as traders have moved previous the preliminary euphoria of the January launch.

“Plainly lots of the TradFi traders aren’t biting anymore,” Thielen mentioned.

Each the slowdown of flows into the ETFs and the current dump in crypto property, nonetheless, are a results of a a lot larger story, argued Thielen. It is the macro atmosphere, he mentioned, that has been and can proceed to be the primary driver behind costs.

“I believe lots of the bitcoin rally is perhaps constructed on fallacious expectations and once more,” mentioned Thielen. “I believe what’s actually, actually essential is that these ETF flows did not cease out of the blue, they stopped round March 12 when the patron worth index and when the producer worth index got here out.”

On the finish of final 12 months and into early 2024, merchants have been betting on a number of curiosity cuts by the Federal Reserve this 12 months on expectations of a continued downtrend in inflation. That anticipation drove danger property, comparable to tech shares and cryptocurrencies, considerably increased.

Nonetheless, current information, specifically the March inflation stories famous by Thielen, has proven that inflation stays properly above the Fed’s 2% goal, main the central financial institution to repeatedly voice uncertainty about whether or not it is going to certainly have the ability to decrease rates of interest this 12 months.

“We have to get the macro headwinds out of the way in which,” Thielen mentioned. For now, he expects a consolidation interval which might final for just a few weeks and will push bitcoin right down to round $50,000 earlier than coming again up in direction of the tip of the 12 months.

Bitcoin Halving Is Not Bullish

Thielen additionally cautioned traders concerning the upcoming halving on April twentieth, which many assume will likely be a wildly bullish occasion for bitcoin. This expectation stems from the token’s earlier post-halving cycles which generally noticed bitcoin race to new all-time highs.

Thielen, although, contended that these bull strikes have been largely a results of the constructive macro atmosphere, and never pushed by the halving itself. The newest halving in Could 2020, for instance, got here alongside huge financial and monetary stimuli surrounding the Covid shutdowns.

“I would not give virtually any credit score to the halving as a result of I do not suppose the halving is the large driver,” he mentioned. “It is actually the large macro components.”

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