If the winter ahead proves to be a significant test for Europe, Bitcoin ( BTC) could drop another 50%.
This was the conclusion of a crypto market analyst who has been in the business of researching cryptocurrency markets for over a decade. BTC/USD failed to regain $20,000 support.
Filbfilb, the creator of DecenTrader trading software, spoke with Cointelegraph and predicted that Bitcoin’s price would drop to $10,000 by 2022.
He believes that the European energy crisis is intensifying, which will put risk assets under severe pressure. The extent to crypto suffering depends on how diplomatically diplomacy can be used to prevent a major emergency in 2023.
These figures aren’t just a dream; Filbfilb was able to time the market bottom perfectly as BTC/USD set a floor at $3,100.
Cointelegraph reached out to get more information about how the coming cold season could impact a already fragile Bitcoin trading environment.
Cointelegraph (CT: You pretty much hit the $3,100 bottom in last cycle. Are you predicting another downturn? If so, what price would you consider a reasonable bottom price this time around.
Filbfilb: The price of Bitcoin is strongly correlated with the “legacy” market, particularly the NASDAQ. We know that the Federal Reserve’s monetary policies are putting a lot of pressure on the NASDAQ. This time, “it’s a little different” because of the high correlation with external economic forces.
It was easy last time due to the volume attributable to the $3,100 top and an 85% correction. The volume base for this time is approximately $11,000. $20,000-$10,000 has a very short time-based history.
Much depends on the winter and how Europe handles the winter. I expect a bad winter to test the volume range highs between $10,000 and $11,000,000. It seems crucial that NATO and Russia have a dialogue about what should happen next. The sooner it happens, the lower Bitcoin prices will be.
CT: What is the difference between the current bear market and the last one? Does macro play a greater role in this cycle than it did last year?
FF It is, therefore, different this time around to some degree. We are making improvements within the normal timeframe. The usual percentage change to normal is normal for where we currently are. It’s “same but different”, for now.
CT – You said recently that a Q1 rally seemed really obvious. What is it?
FF Two reasons:
First, Bitcoin exits the bear markets after about 1,000 days, depending on whether the actual halving of supply emission date is used. After Q1, the new narrative begins.
We will also be past the winter. From a game theory perspective, it is likely that things will improve if Europe can navigate the winter economically. Conversely, if things go wrong, it will increase the likelihood of dialogue which would bring stability in the short-term. This scenario could be positive thinking, so I would estimate a 33% chance.
CT: What is your opinion on Ethereum switching from proof-of-stake to proof-ofstake? Is it going to increase its long-term value proposition?
FF. This is a tricky question. However, the lower emission of coins should act as a catalyst for value.
CT: Do you think you are bullish on ETH/BTC and other altcoins with the Merge coming in two weeks? Or will this be a sell the news event?
FF I’m bullish on ETH in general. It’s essentially similar to a halves effect. The history of the world tells us that people rally around these events, then drop shortly afterwards, but the overall direction is up.
This idea is appealing to me, but I am not averse to the CPI data that drops at the same time. This will be a key factor. While BTC may outperform in the short-term, positive CPI data combined with a sell-the news event could mean that ETH might do well over the next cycle.
CT: Were your surprised by the 3AC’s collapse? Is there still a systemic risk?
FF I was shocked that the people who provided funding didn’t do their research beyond speculation. It’s not surprising that a business that has experienced exponential growth results in margin cutting.
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Naivety is the best way to view it. Everyone believed their own hype, and ignored risk. It is shameful that the finance professionals involved should have prioritized growth over risk. It’s obvious that crypto volatility is a real danger. To ignore it would be negligent or amateurish at best. Given the value involved, this could easily happen.
CT – Will September see the Fed draining more dollars liquidity through quantitative tightening?
FF. Yes, they will prove that the Fed is strong and will raise rates on either good or bad news. They have the ability to do this if they are given good news; bad news will make it more difficult.
CT – Will it adversely affect the BTC prices going into 2023
FF. It all depends on the weather in the EU. The relationship between the EU & the U.S. is often forgotten. If the EU suffers, the U.S. will also suffer. Imports will become more expensive and demand will drop.
Let’s wait and see what winter brings.
These views and opinions are the author’s and do not necessarily reflect those of Cointelegraph.com. You should do your research before making any investment or trading decision.
