More Pain Coming to Bitcoin and Crypto Markets, Warns Partner at Top Crypto Investment Firm

More Pain Coming to Bitcoin and Crypto Markets, Warns Partner at Top Crypto Investment Firm

News
June 12, 2021 by J.D. Smith
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A partner from a top crypto investment firm is warning that more pain may be in store for Bitcoin and the crypto markets before investors can start thinking about new rallies. In a tweetstorm, the pseudonymous SpartanBlack from Spartan Group weighs in on the state of the crypto markets. ADVERTISEMENT   According to the crypto

A partner from a top crypto investment firm is warning that more pain may be in store for Bitcoin and the crypto markets before investors can start thinking about new rallies.

In a tweetstorm, the pseudonymous SpartanBlack from Spartan Group weighs in on the state of the crypto markets.

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According to the crypto investment firm executive, with Bitcoin down over 40% from its all-time highs, it’s safe to say that BTC and the crypto markets are in a bear market. Though the bulk of the correction is likely over, SpartanBlack says another leg down may be on the horizon.

“Using BTC as a proxy,
50% down vs ATH = $32,440 (-3% from here)
60% down vs ATH = $25,952 (-22% from here)
70% down vs ATH = $19,464 (-42% from here).” 

He says the worst thing that could happen from this point onward is likely a 40% drop from current prices.

“So in terms of quantifying the downside risk from here, my base case would be a further 20-30% down from here, with 40% being a worst-case scenario.”

While SpartanBlack sees more downside potential for Bitcoin, he notes that there’s a possibility the recent sell-off could just be a correction within a greater bull cycle, which means investors won’t have to wait as long for big returns.

“In terms of upside, I think a 3-5x return over a 3-4 year timeframe is conservative judging from: 1) returns generated in the latest cycle (20x for BTC); 2) more institutional capital flowing into crypto; 3) implied total market cap of $4.5-$7.5 trillion (smaller than market cap of gold).

Finally, if somehow this recent correction is but a short-term detour within a continuing bull market, then we will likely see the 3-5x return realized in 6-9 months instead of 3-4 years.” 

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