Bitcoin's Wild Ride: Why Big Drops Are Still Possible
Bitcoin's reputation for wild price swings is far from over. Tom Lee, a well-known figure in the crypto world, recently shared his thoughts on the matter.
Bitcoin's Unpredictable Nature
- Synchronization with Stock Market: Bitcoin often moves in sync with the stock market, but with bigger ups and downs.
- Potential Drops: The stock market has seen many 25% drops lately, and Bitcoin could easily see something similar or worse.
The Myth of Stability
The idea that Bitcoin is becoming more stable might be wishful thinking. Some believe that new investment products and big investors will calm things down. However, Lee thinks Bitcoin will keep following its own unpredictable path.
Bitcoin's Four-Year Cycle
Lee also talked about Bitcoin's usual four-year cycle. He thinks this cycle might be changing, leading to a longer and possibly more unpredictable price journey.
- Price Predictions: He even predicted that Bitcoin could reach between $200,000 and $250,000 by the end of the year.
- Potential Drop: But he also warned that a 50% drop from that high could bring it back down to around $125,000.
Historical Context
This isn't the first time Bitcoin has seen such big drops. In late 2021, it hit a high of $69,000 before falling to around $35,000 in just a few months. Other experts, like Peter Brandt, have also warned about similar big drops.
Diverging Opinions
Not everyone agrees with this gloomy outlook. Some Bitcoin supporters believe that the worst of the price crashes are behind us. Michael Saylor, for example, has said that the bad times are over.
