Yerevan (CoinChapter.com) — Bitcoin topped above $61,000 earlier this month. And, according to an investment strategist, the cryptocurrency stands too exhausted to continue its upside run, at least in the near-term.
Boris Schlossberg, managing director of FX strategy at BK Asset Management said “the whole rally in crypto is getting very long in the tooth” in an interview with CNBC’s Trading Nation. The chief noted that Bitcoin could become a better store of value than gold, but its adoption at PayPal might remain dwarfed compared to the use of fiat money.
On Tuesday, the global payment firm announced that it now offers a crypto checkout option to its users in the US. With that, it enabled users to pay merchants through their PayPal-based cryptocurrency wallets. The service supports four cryptocurrencies: bitcoin, bitcoin cash, litecoin, and ether.
Nevertheless, it converts the cryptocurrency to fiat right before depositing the amount in merchants’ wallets, a trick common across many crypto-checkout services to avoid cryptocurrencies’ wild price fluctuations.
“I don’t think any asset that has the volatility of 20% per week can really act as a currency at this point,”argued Mr. Schlossberg.
Bitcoin to $52,000 Next: Another Analyst
Mr. Schlossberg’s bearish outlook on Bitcoin appeared after the cryptocurrency market, on the whole, gained further recognition among mainstream financial firms. Earlier this week, Visa, conducted its first USDC transaction on its legacy platform. USDC is a stablecoin pegged to the US dollar’s value. Therefore, its price does not fluctuate like other cryptocurrencies.
Bulls remained bullish over Bitcoin’s response to the adoption news as discussed above. The cryptocurrency earlier Wednesday closed towards $60,000 before plunging lower by more than $3,000 within minutes, much in line with what Mr. Schlossberg warned about.
“I think we’re very, very close to perhaps an intermediate-term top here. A little bit of a correction is certainly due at this point,” he added.
In the same interview with Trading Nation, another analyst, Matt Maley said that the next bitcoin level to watch out for is $52,000.
“If it breaks below that level, it’s going to be a big warning flag,” Mr. Maley: “However, right now, with that series of higher highs and higher lows, I think the [path] of least resistance is higher.”
“So, if it breaks above its recent highs of 61,000, it should see another leg higher. That said, I do agree with Boris. In a very volatile situation, it’s going to see a lot more big declines along its way. It may change the world, but Amazon changed the world. It still saw a lot of deep corrections as well.”