Bitcoin crashes below US$30,000 support level…now what?

The world’s largest crypto has lost more than half its value since mid-April.

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Bitcoin (CRYTPO: BTC) has broken below the psychologically important support level of US$30,000.

In an article on Monday I explained that, despite the notorious unpredictability of crypto prices, some analysts had forecast Bitcoin would find support at US$30,000. That’s partly because people like nice round numbers. But mostly it’s because, “in options, $30,000 is the most-sold downside strike price for July”.

Round numbers and options signals notwithstanding, at time of writing one Bitcoin is worth US$29,875 (AU$40,925). The token traded as low as US$29,307 earlier today.

The world’s biggest crypto by market cap has now lost 54% of its value since hitting an all-time high of US$64,829 in mid-April this year.

The question investors are asking now is, what’s next?

What’s next for Bitcoin?

Will Bitcoin go to zero?

That was Magellan’s co-founder Hamish Douglass’s position earlier this week. Douglass said, “Cryptocurrencies, I have to say, are one of the greatest irrationalities I’ve seen in a very, very long period of time because of the cult-like following it has behind it and the scale that is behind it.”

Douglass may be right.

On other hand, Morpher’s CEO Martin Fröhler, may be onto something too.

In a survey of 42 crypto experts conducted by Finder, Fröhler forecast Bitcoin will hit US$160,000 by the end of the year:

Adoption by corporations and institutional investors paired with a loose monetary policy and high asset inflation will propel Bitcoin to 6 figures before the end of this year. The next halving cycle will see increased adoption of Bitcoin as a legal tender by developing countries, and until 2030, Bitcoin will have replaced gold as a global reserve asset.

Following the token’s recent losses, Simon Peters, market analyst and crypto expert at online trading platform eToro, cited the Finder survey saying, “Long-term confidence remains high… [M]ore than half [of the surveyed experts] believe Bitcoin is capable of becoming the global reserve currency by 2050.”

The average end of year price forecast for Bitcoin by the panellists is US$66,284, more than double its current price. 61% of the participating fintech pros believe it is currently undervalued.

So who’s right?

I’ll let you know come 31 December!

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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