Bitcoin’s recent price surge has been incredible, but not everyone’s convinced it’ll last. A prominent analyst is warning of a massive crash, potentially wiping out almost all of Bitcoin’s gains.
A 90% Bitcoin Price Drop? Here’s Why
Mike McGlone, a senior commodity strategist at Bloomberg Intelligence, recently predicted a brutal downturn for Bitcoin. He believes Bitcoin could plummet to around $10,000 – a massive drop from its recent highs.
McGlone points to Bitcoin hitting $100,000 as a key psychological turning point. He sees this not as a sign of strength, but as a market that’s become overheated. He uses the phrase “selling when there’s yelling” – basically, everyone’s excited, which often means it’s time to sell.
Since Bitcoin hit $100,000, gold has performed much better, gaining about 30%, while Bitcoin only gained around 8%. Other markets, like the S&P 500, have also shown modest growth, leaving Bitcoin lagging.
Bitcoin’s Changing Role
McGlone highlights a growing link between Bitcoin and the broader stock market. This means Bitcoin is now more of a “risk-on” asset, meaning its price moves with the stock market, rather than being a stable, independent investment.
He also points to volatility indicators. When the market’s volatility was low, Bitcoin hit new highs. But when volatility spiked, it suggested a shift in market sentiment. This, he argues, signals a potential correction is on the horizon, with gold likely to outperform Bitcoin.
Forget Bitcoin Hitting $1 Million
McGlone also poured cold water on the idea of Bitcoin reaching $1 million. He argues that the current market conditions are vastly different from when Bitcoin was around $10,000. Back then, sentiment was negative, creating a perfect environment for a bull run. Now, with so many people betting on Bitcoin going up, it’s much more vulnerable to a price drop. The current market is “crowded” with investors holding long positions, making a sustained upward trend less likely.
