The predictions for Bitcoin | InvestorPlace

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Bitcoin crashes to a six-week low…but adoption continues to grow…which our experts Luke Lango and Charlie Shrem see coming…a Crypto Cash Calendar event today

Last Monday, bitcoin fell to a six-week low, hitting $38,423.

As of this writing on Wednesday morning, prices are only marginally higher, trading at around $38,700.

This weakness represents a continued shift in how investors view bitcoin and the broader altcoin market here in 2022.

Specifically, while these assets were considered “inflation hedges” throughout 2021, this year they have become “risky assets.” And like just about every other risky asset, they are abandoned.

Below we look at bitcoin (in green) versus the 10-year Treasury yield (in black) since January 1, 2021.

You’ll see that, yes, the price of bitcoin generally tracked the 10-year Treasury yield in 2021, suggesting it was an inflation hedge. But when 2022 came, there was a complete blackout.

The circled gaping divergence speaks for itself.

Source: StockCharts.com

Our crypto experts Luke Lango and Charlie Shrem discussed this bitcoin/10-year Treasury yield relationship in their latest issue of Crypto Investor Network:

Bitcoin’s correlation with the 10-year Treasury yield – which has persisted for much of 2021 – has completely collapsed.

Over the past month, the two are almost perfectly anti-correlated, so the “Bitcoin is digital gold” thesis is completely ignored by the market.

Instead, the “Bitcoin is a risky asset” thesis is what the market is focusing on right now. Bitcoin’s correlation with the ARK Innovation ETF turned extremely positive in 2022 and remains very strong today.

To that end, we continue to believe that we should treat Bitcoin like Nasdaq and altcoins like hypergrowth tech stocks.

Stocks are being hit hard right now by rising 10-year Treasury yields, hawkish comments from the Fed and fears of recession. As long as this three-headed risk monster remains, stocks and cryptos will fight side by side.

If you read yesterday’s Digest, you know Luke predicts more pain for stocks over the next two months. He thinks we’re either going to enter a bear market or get very close to it.

But on the other side of that pain is a massive rally for top tech stocks. And given the correlation between technology and crypto today, it also suggests a similar roadmap for crypto.

***In the meantime, look beyond the price of bitcoin for its growing global adoption

In the grand scheme of things, bitcoin and altcoins are still in their infancy. And any new asset class is going to experience massive volatility as it struggles to go from “strange and unfamiliar” to “familiar and popular”.

Given this, perhaps more important than bitcoin’s daily price swings is its progress towards mainstream adoption. And when we check this progress, we see an uptrend.

Yesterday we saw the Central African Republic accept bitcoin as legal tender. The country joins El Salvador in giving bitcoin legal tender.

Meanwhile, the use of bitcoin as currency in the United States is also increasing.

Since Looking for Alpha:

Will bitcoin (BTC-USD) become a widely used medium of exchange?

Its lack of acceptance as a means of payment by merchants, as well as its high transaction costs, “is changing,” Morgan Stanley analyst Sheena Shah wrote in a note to clients Thursday…

A slew of payment companies, in particular, are looking to expand their reach in the growing decentralized space.

For example, payment company Strike recently partnered with point-of-sale provider NCR (NCR) and rewards-based payment company Blackhawk Network, which “could mean a large number of physical stores, restaurants and cafes in the United States will be able to accept bitcoin payments in the near future,” Shah explained.

Finally, earlier this week, Fidelity Investments announced plans to allow investors to put bitcoin in their 401(k).

From Dave Gray, Head of Workplace Retirement Offerings at Fidelity:

We have seen growing and organic interest from customers.

We expect cryptocurrency to shape how future generations think about investing in the short and long term.

Yes, bitcoin price is low. No, this does not reflect the future of Bitcoin.

*** Expect more short-term volatility, especially for smaller altcoins

In their update, Luke and Charlie reveal an interesting dynamic they see playing out in the crypto industry right now:

… We have observed that the majors – Bitcoin, Ethereum, etc. – have largely outperformed altcoins in 2022. Indeed, the smaller and “riskier” the crypto, the more it has fallen this year.

Year-to-date, Bitcoin is down 12% while Ethereum is down 17%. Not great.

But really good compared to other altcoins. The avalanche is down 23%. Polkadot is down 31%. Uniswap is down 48%. Algorand is down 57%.

We believe that the crypto markets are currently consolidate around the majors because short-term risk appetites are depressed but long-term bullish sentiments remain.

Of course, the exaggerated volatility of small altcoins goes both ways. While fear can bring any altcoin down into the double digits, any type of significant bullish catalyst can bring them up the same way.

As an example, earlier this month Luke and Charlie sent out a profit sell alert. They recommended Crypto Investor Network subscribers lock in 50% earnings on a third of their position in a high-end altcoin they had recommended. The most interesting detail is that they had only held the altcoin for two weeks.

Obviously, even in a bearish environment, these types of sudden price increases can occur. The question is: can you position yourself in advance?

*** On that note, I’ll direct you to Luke and Charlie Crypto Cash Calendar

Here’s Luke and Charlie, explaining what it is:

Crypto is the future. But that doesn’t mean everything cryptocurrencies are the future.

To sift through all the blockchain noise, we have assembled an exclusive team of crypto engineers and coders to collectively research, analyze and understand the core technologies underlying the cryptocurrency revolution.

Informed by this research, we are able to interpret the usefulness and potential impacts of these technologies.

Here’s how it works: Behind the scenes, our proprietary research system collects information and indicates which altcoins and crypto events are of particular interest.

From there, we’ll share with you the most exciting and promising coins and events from our Crypto Cash calendar.

Turns out today Luke and Charlie are breaking some news that sparked their Crypto Cash Calendar system.

I don’t know what the news is, or what altcoin it affects. But I know the last time that Schedule reported something was March 22. The associated altcoin soared 17% over the next eight days. To have access to Crypto Cash Calendar as a subscriber, click here.

Returning to the wider sector and what’s in the pipeline, here’s Luke and Charlie with the final say:

We expect more volatility in the crypto markets. But we believe that amidst this volatility, we will continue to see consolidation around the majors, and that the majors will significantly outperform…

We further anticipate that this volatile period will be short-lived and end in a positive resolution.

Therefore, as soon as the price action further down the risk curve starts to improve, we will start taking bites again on smaller altcoins.

Have a good evening,

Jeff Remsburg

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