Summary

The article discusses the potential decline of Bitcoin in 2023 and 2024 amidst economic challenges and compared to the Dot Com crash.

Abstract

The article presents a bearish outlook on Bitcoin's future, suggesting that despite the cryptocurrency's previous highs, current macroeconomic factors do not support a bullish stance. The author points out that while major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) may survive a market crash, many smaller cryptocurrencies, termed "sh*tcoins," are likely to become worthless. The author emphasizes the impact of ongoing issues such as supply chain disruptions, the war in Ukraine, and aggressive interest rate hikes by the Federal Reserve, which collectively suggest an impending recession. The article includes a chart indicating Bitcoin's potential further decline to a support level, with the next stop predicted at $12,5000, eventually heading towards$ 10,000. The author, while not a financial advisor, shares their insights on market trends and advises caution for Bitcoin investors, considering the current economic climate.

Opinions

The author believes that the current economic indicators, such as supply chain issues, the Ukraine war, and Fed rate hikes, are bearish for Bitcoin.
The article suggests that many cryptocurrencies, apart from the largest ones, are overvalued and could lose all value.
The author implies that Bitcoin's past performance may not be indicative of future results, especially given the lack of historical bottoms to establish strong support levels.
A bear market bounce may be possible in the short term, but the author's long-term view is that Bitcoin will likely continue to decline.
The author encourages readers to support their work by becoming Medium members, indicating a personal investment in the content's reception and potentially a series of articles on similar topics.

Why Bitcoin could plummet in 2023 and 2024

This is a tough time to be in the market — especially if you’re a cryptocurrency investor.

Everything seems to be tanking in unison. Even blue chip giants like Apple, Google, Amazon, JP Morgan, and Berkshire Hathaway are struggling to stay above water at this point.

At least investors in AAPL, GOOG, AMZN, JPM, or BRK.B (or A if you’re really rich!) know that, even in what is almost certain to be a recession at this point, their shares are tied to real companies with real assets and real income.

It’s white knuckle time for crypto investors though, because their “currency” is tied to little more than air.

Anyone who remembers the Dot Com crash (or who has at least read about it) knows what happened to the most fanciful of the tech companies of the time: they went to zero.

While I do think that the biggest cryptos — BTC, ETH — will probably survive the next crash, a lot of sh*tcoins are dead money walking.

I’m not a financial advisor and this article should not be construed as financial advice, but I’ve found some success with figuring out where stocks are headed and where they’re likely to bounce (or collapse).

Where Bitcoin is headed next

The following is an ugly chart if you’re a BTC holder.

It’s decision time for Bitcoin.

I find that, typically, you can find the major support and resitance points by finding where a stock or crypto hits a top AND a bottom.

As you can see, we’re a little short on bottoms for Bitcoin.

While this could be a major support point given that monster top from 2017, consider this: what macroeconomic factors would you consider bullish right now?

Supply chain is still messed up, there’s a war in Ukraine, and most importantly — the Fed continues to curb-stomp the economy with rate hikes (and they’re not done).

Oh, and we’re probably going to get confirmation of a recession soon. If you think people are going to hold Bitcoin when they’re out of work and struggling to pay bills … you may want to reassess.

The area I marked in red is what I think the next leg down is for Bitcoin.

If you’re a holder, I hope that’s not the case, but I can’t really figure out a bullish hypothesis.

There may be a little bear market bounce coming in the next couple of weeks, but I think the next realistic stop for Bitcoin is $12,500 en route to $10,000.

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