CNBC analyst Brian Kelly believes Bitcoin (BTC) still possesses more downside potential even as it trades at over 70% off its all-time high.
On CNBC’s Fast Money, Kelly says the flagship crypto could still fall nearly 50% from current levels as the macro environment worsens.
“The good news is that I do think we are getting a lot closer to a generational bottom. The bad news is that it might not be until Bitcoin hits $10,000.”
Bitcoin is trading for $19,200 at time of writing.
The CNBC analyst says Bitcoin is likely to bottom out once it experiences a Lehman moment, a scenario that is potentially months away. A Lehman moment is that instance when the fear that turmoil in one asset or industry could become more widespread.
“We are probably months away from a Lehman moment, meaning that kind of one last flush down. Somebody big goes bankrupt that you never expected. We are probably months away from that.”
According to Kelly, the Bitcoin crash will be triggered by central banks’ policy errors and accentuated by deleveraging in the market.
“The catalyst for it is going to be inflation expectations picking up and every central bank in the world is making a policy error… And I think if you get those three combos, a final flush out of all this leverage in Bitcoin down to $10,000, $15,000, somewhere around that, and inflation expectations picking up, which I see coming in the next quarter or so, and we all know every central bank has already made a policy mistake and likely to continue to do more, that is the perfect scenario for a bottom in Bitcoin.”
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
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