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Bitcoin: $250K as early as 2023? - Gold rush mood reaches financial institutions

Published 2022-12-06, 04:50 a/m
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By Marco Oehrl

Investing.com -- The fact that the technology on which Bitcoin, Ethereum and Co. are based is revolutionary, is undisputed. However, when it comes to assigning value to cryptocurrencies, two hardened camps suddenly form. On one side are the crypto enthusiasts whose eyes start to light up when they talk about cryptocurrencies and their possibilities. But from the other side, people not only question the sense of cryptocurrencies, but also argue that they are completely worthless.

The recent market turmoil has further exacerbated this discussion. For, while people had become accustomed to the fact that cryptos are quite volatile and that many a fraudster has been up to their mischief in this business, the collapse of entire ecosystems is completely new.

Even seemingly thriving business models can collapse within a week, causing significant market dislocation. This will inevitably lead to shifts in market share within the crypto business model.

While FTX falls away as one of the major backers, investment banks like Goldman Sachs are waiting in the wings to take over this market. There is a realization that there is good money to be made on the leap of faith that has been taken. Goldman Sachs' head of digital assets Mathew McDermott said:

"We do see some really interesting opportunities, priced much more sensibly."

Standard Chartered says the gold rush phase has just begun among long-established financial institutions. That's because while many are hoping bitcoin will form a bottom at prices around $17,000 and reach new all-time highs from here, they expect it to crash to $5,000 in the coming year.

Such a development would play into the cards of institutions like Goldman Sachs and Blackrock. Business shares can be taken over cheaply in order to generate maximum returns from them in the long run because one thing is known for sure, FTX was a money-printing machine. There are growing indications that FTX collapsed only because of the incompetence of the management. A problem that may even be systematic in the crypto sector when founders overestimate themselves immoderately and fail to hand over competencies.

Although this is quite a gloomy outlook for the crypto community in the short term, there are also bright spots. Tim Draper is one of the enthusiasts. He said:

"I have extended my prediction by six months. $250k is still my number. I expect a flight to quality and decentralized crypto like bitcoin, and for some of the weaker coins to become relics."

Bitcoin technical price marks

Bitcoin is currently losing -1.92% at a BTC/USD price of $16,978, while the weekly gain is 3.58%.

Although the cryptocurrency reached its daily high yesterday at $17,395, the day's close occurred in the area of the 23.6% Fibo retracement of $16,986. Thus, trading continues to take place in the range around the aforementioned Fibo retracement, which has held since December 1.

Bitcoin (BTC/USD) Tageschart

A daily close below the 23.6 percent Fibo retracement would favor a move lower toward the Nov. 28 low at $16,013. Below that, the focus would shift to the Nov. 21 low, which is at $15,504.

On the flip side, the 38.2% Fibo retracement of $17,841 offers immediate resistance, followed by the 55-day MA at $18,266 and the 50% Fibo retracement of $18,533.

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