The sentiment in the crypto market was completely different just a few weeks ago. It was almost impossible to escape the doom and gloom. People have announced that the price of Bitcoin will fall to $10k. And then there were even bleaker predictions where people claimed Bitcoin was dead. That he will never be able to recover from everything that happened last year. As easy as it is to fall into FOMO in the Bitcoin market, it is perhaps even easier to fall into FUD.
But then the FED went slightly dovish and there is excitement again in the Bitcoin market with the implementation of Ordinal NFT. The mood of the market started to change. But surprisingly; the most bullish factor was also one of the most bearish. Over the past two weeks, the SEC has come out in full force in its attack on crypto. Post staking, stablecoins and probably much more in the future.
During these types of attacks; we can expect the price of Bitcoin to drop dramatically. But it didn't happen. The price of Bitcoin is down slightly, but it appears that the market has run out of sellers. In the following days, the price of Bitcoin continued to rise to almost $25 before seeing a slight pullback. With the combination of the market seemingly running out of sellers and the price rising after bad news. These are great signs or confirmations that the Bitcoin price has bottomed out. Now is the time for the price to go up.
But how high can the price of Bitcoin go this year, and can it reach new all-time highs?
As always, please remember that these are my opinions and should not be taken as financial advice. Although I honestly think Bitcoin will see great price performance going forward. There is a chance I could be completely wrong.
Why he will NOT set a new all-time record this year
Before we go on the upward path, let's stay grounded and talk about why Bitcoin won't make a new all-time high this year.
Simply put, the world is still suffering economically. People have much less spending money to invest in high-risk assets. We could very well see most financial markets take a dive, including Bitcoin. Not only is the world suffering, but because of all the frauds and defaults in the crypto year. His image is badly damaged. Big money that might have been invested in the market is now sitting on the sidelines.
Because of all of crypto's self-inflicted wounds, the US government seems ready to finally regulate crypto. Unfortunately for us, they seem to be out for blood. Bitcoin currently sits at $25k, far from its previous peak of $69k. Even if we saw BTC jump significantly this year. It may not reach that price level yet.
Why this year WILL make a new all-time high
With that said, the price of Bitcoin is almost $24,000 after seeing big price moves in the last month. It currently needs less than 3x price to set a new all-time high. If things turn bullish, it's definitely possible.
The biggest reason is that while people are still suffering for money. The FED appears to be at the end of the line when it comes to raising interest rates. This will cause the price to rise throughout the year.
The advertising phase of Bitcoin Ordinal should not be overlooked. Arguably, the summer of DeFi in 2020 helped fuel the boom. And perhaps the NFT craze in 2021 has led to an even bigger spike in prices. The hype surrounding Ordinals, as well as the fact that it is bringing excitement back to Bitcoin, may also have this effect. A bull run where people feel the FOMO to not only buy Bitcoin but participate in its ecosystem is something we have never seen before. It would be interesting to see how this changes everything.
Although it is bearish that the US SEC is going after crypto and stablecoins. They said that perhaps Bitcoin is the only cryptocurrency that is not a security. If the SEC continues to aggressively attack stablecoins and other cryptocurrencies, it could cause panic in the market. Where people are looking for security and that's why they put their money in bitcoins. As crazy as it sounds, before stablecoins there was a time when Bitcoin was considered the most stable cryptocurrency on the market. Cryptocurrency owners would trade Bitcoin for safety. Similar to how traders use stablecoins today. Maybe it could happen again.
Although there could always be a surprise announcement or a great macro factor to send the price of Bitcoin soaring. The truth is, there is a sleeping giant event waiting on the horizon. The Next Bitcoin Halving. This will be held next year and chances are that everyone will try to make it a lead. There is a good chance that prices will recover and even surpass previous highs before this happens. A Bitcoin halving happening with a price above $24,000 makes me very excited about the future price potential.
But will it really happen?
I am one of the most optimistic and biggest supporters of Bitcoin. This is the project I am most passionate about and also accumulate the most. In 2023, I expect great things for the price of BTC. But I don't expect new highs. Although I'd love to be wrong about that.
What about you? Do you think bitcoin will hit a new all-time high this year?