YouTube channel host Coin Bureau warns that rising interest rates will negatively impact crypto assets.
Hosted by The Coin Bureau speaks to his 80,300 YouTube subscribers that Bitcoin (BTC) could fall over 35% from current levels as interest rates rise.
“Now that interest rates are rising, risky assets like stocks and especially cryptocurrencies will be less attractive to investors.
The likelihood of further selloffs is why many are now predicting that BTC could fall as low as $12,000 in the coming months, which of course makes our current struggles around $18,000 seem almost joyous in comparison.
Bitcoin is trading at $19,280 at the time of writing.
According to the host of Coin Bureau, the expected 0.75% rate hike by the Federal Reserve could already be paid for by reducing the chances of Bitcoin falling by over 35%.
The Coin Bureau host, however, says rates could be raised by a higher figure based on a tool used to predict the Federal Reserve’s interest rate decisions – FedWatch tool.
“There is now a good chance that the market has already priced in this 75 basis point rate hike, which would mean that a drop to $12,000 is less likely, at least for the next few weeks.
However, consider the fact that according to the FedWatch tool, there is currently a 20% chance that we could see a full 1% rate hike. It would now be the largest single rate increase in 40 years.”
Aside from rising interest rates, the Coin Bureau host says Bitcoin faces other threats such as a negative technical outlook and growing short positions.
“Many institutional short positions are open for BTC, according to CFTC data [Commodity Futures Trading Commission].
I’m afraid that for those who prefer to trust technical analysis, there is not much comfort there either.
In short, whether you’re in stocks, crypto, or really anything else, this winter is going to be shit.”
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