Community economist Timothy Peterson warns that if the US Federal Reserve holds off on charge cuts in 2025, it might trigger a broader market downturn, doubtlessly dragging Bitcoin again towards $70,000.
“What it wants is a set off. I feel that set off could also be so simple as the Fed not reducing charges in any respect this 12 months,” Peterson stated in a March 8 X publish. Peterson’s remark comes only a day after Federal Reserve chair Jerome Powell reiterated that he is in no hurry to regulate rates of interest.
Fed charge lower delay might spark bear market
“We don’t have to be in a rush and are well-positioned to attend for better readability,” Powell stated in a speech in New York on March 7.
Supply: Timothy Peterson
Peterson, who’s the creator of the paper “Metcalfe’s Legislation as a Mannequin for Bitcoin’s Worth,” estimated how low the Nasdaq might fall to foretell Bitcoin’s (BTC) potential backside in “the following bear market.”
Utilizing Peterson’s Nasdaq lowest value ahead mannequin, Peterson estimated that the underside would take about seven months to type, with the Nasdaq dropping 17% over the interval.
Making use of a “1.9” occasions multiplier to that quantity for Bitcoin’s decline, he estimated a 33% decline in Bitcoin, bringing it all the way down to $57,000 from its present value at publication, $86,199, in response to CoinMarketCap knowledge.
Supply: Timothy Peterson
Nevertheless, he stated Bitcoin probably received’t drop that far, anticipating a backside nearer to the low $70,000 vary based mostly on historic developments from 2022.
“Merchants and opportunists hover over Bitcoin like vultures,” he stated, explaining that after the market expects Bitcoin to hit $57,000, “it received’t get there as a result of there are all the time some buyers who step in as a result of the worth is ‘low sufficient.”
Bitcoin’s 2022 low didn’t drop as anticipated
“I bear in mind in 2022 when everybody stated the underside can be $12k. It solely went to $16k, 25% increased than anticipated,” he stated earlier than declaring that the 25% improve from $57,000 is $71,000.
The final time Bitcoin traded on the $71,000 value degree was on Nov. 6, after Donald Trump received the US election, earlier than rallying for a month and reaching $100,000 by Dec. 5.
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In January 2025, BitMEX co-founder Arthur Hayes echoed the same value prediction.
“I’m calling for a $70k to $75k correction in BTC a mini monetary disaster, and a resumption of cash printing that can ship us to $250k by the top of the 12 months,” Hayes stated in a Jan. 27 X publish.
In December 2024, crypto mining agency Blockware Options stated Bitcoin’s “bear case” for 2025 can be $150,000, assuming the Federal Reserve reverses course on rate of interest cuts.
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