Bitcoin continues to struggle as it trades below $60,000 and well below its all time high of over $130,000. Everyone who was betting that BTC would continue its march higher is in a world of pain.
Strategy (NASDAQ:MSTR) is struggling as the original Bitcoin proxy firm is its shares are trading off its all time high of over $400. Today, Strategy is trading around $87.
Bitfinex analysts see a future where the gloom and decline for Bitcoin continues. According to a note shared with CI, the firm states that Bitcoin could trade as low as in the $40,000s.
The company states:
“Currently trading near $60,000, the key structural levels for BTC remain the same, given that the outflow streak on ETFs has not broken and the demand channel via treasury products has not made a comeback. Should a macro catalyst trigger another leg lower in the near term, the Realised Price at $53,400 stands as the most compelling technical floor within the current bear market range. That reading is grounded in on-chain cost basis dynamics and typical short-term holder behaviour. Going by historical four-year cycle, even after accounting for diminishing returns, a final wick into the $40,000s before sustained recovery remains entirely possible.”
Bitfinex describes the decline in price as a “structural exodus in the spot markets” exacerbated by ETF selling and short term holders booking losses.
“The collapse of the DAT/treasury channel effectively stalled new capital raises, blunting a crucial demand channel for BTC, and leaving the market without its primary demand engine and pushing the total drawdown from its All-Time High (ATH) to 53.9 percent.”
Bitfinex notes that Bitcoin is down 53.9% from its all time high.
They foresee a need for a resurgence in spot demand so Bitcoin can find a floor and perhaps turn higher but Bitcoin trading seems willing to get worse.