As of June 5, Bitcoin has risen by more than 60%. Many industry giants (including Binance founder Zhao Changpeng, F2Pool founder Shenyu, etc.) and cryptocurrency analysts are optimistic about the future development of cryptocurrency and say that the bull market has arrived. However, Mike McGlone, a senior commodity analyst at Bloomberg, pointed out in his latest report that the worst period for Bitcoin may not be over yet and it will face more difficulties in the future, and pointed out that BTC may fall to $7,000.
Bloomberg analyst: Bitcoin will face more difficulties
On June 2, Bloomberg senior commodities analyst Mike McGlone said in his latest report titled "June Cryptocurrency Outlook" that although the market has rebounded recently, he predicts that the broader downward trend will continue.
According to McGlone, the plunge in commodities, producer prices and bank deposits could be a sign of deflation as the Federal Reserve's tightening policy lags behind, and the U.S. economy could face headwinds and liquidity tightening in the second half of 2023.
The cryptocurrency market may face their first U.S. recession, a possible bear market in the stock market, central banks becoming more wary of cryptocurrencies after FTX, and high interest rate competition and other headwinds, which will hinder Bitcoin from leading a sustained rebound in the crypto market.
At the same time, he also expressed doubts about Bitcoin's ability to withstand the contraction of the US economy. He believed that Bitcoin, known as digital gold, is too young and will perform worse than physical gold during a recession.
Bitcoin could drop to $7,000
Additionally, Macron issued a warning on May 22, noting that Bitcoin could potentially fall to as low as $7,000 (the average price of Bitcoin in 2019, and before the massive liquidity injection in 2020).
McLennan said that Bitcoin prospers when liquidity is abundant and plummets when liquidity is withdrawn, and the downward trend of the 52-week moving average shows that Bitcoin has not escaped the downward trend.
Bitcoin price, market value analysis: Is the bull market coming?
Since entering June, the price of Bitcoin (BTC) has been fluctuating in the $27,000 range. As of June 5, the price of Bitcoin was $27,083.37, which is approximately NT$831,657.17 at the current exchange rate.
Blockchain data analysis agency Glassnode pointed out on June 2 that "after a period of large capital outflows, Bitcoin's realized market value has stabilized and started to record net capital inflows again. However, compared with previous bull market conditions, this trend is still in its infancy in terms of duration and magnitude."
The "realized market cap" metric evaluates the Bitcoin market based on the last price each Bitcoin in circulation moved, which is different from the market cap metric that multiplies the current price by the number of Bitcoins in circulation. This distinction means that the realized market cap metric reduces the impact of tokens that may have been lost or in the hands of long-term holders on the valuation model.
Additionally, Glassnode said on June 3 that Bitcoin miners can still be profitable under current market conditions, generating a total revenue of $24.1 million from block subsidies and transaction fees, an estimated production cost of $19.1 million, and a net profit of +$5 million.
