The brief upswing last weekend held the market at a relatively stable level, even though the 24-hour figures for Litecoin, Cardano, TRON, IOTA and several other altcoins are in the red. However, the crypto market is still waiting for a major breakout. If Tom Lee’s forecast proves accurate, Bitcoin could climb to $25,000 by the end of the year.
After last Friday, when market capitalization stood at roughly $234 billion, the market experienced a short-lived surge that brought more than $10 billion into the sector within a very short period.
On July 3, 2018, the market received another boost following a tweet from Coinbase announcing that Coinbase Custody had officially launched and was opening the door to institutional investors. That announcement prompted another inflow of more than $10 billion in fresh capital. At the time of writing, total market capitalization is $264 billion.
Despite higher trading volumes, the upward trend could not be maintained. Bitcoin’s and Ethereum’s trading volumes rose last week from $3 billion and $1 billion to $4.9 billion and $1.8 billion, respectively, but that increase failed to produce a sustained rally.
Many analysts warn that if Bitcoin breaks below the key $6,300 level, the price is likely to drop back under $6,000. Conversely, if Bitcoin climbs above $6,700 within the next 24 hours, a short-term rally could occur, although that seems unlikely based on the price action over the past day.
Industry experts generally expect another significant decline before a new rally can begin.
Arthur Hayes, CEO of BitMEX, predicted that Bitcoin will eventually reach $50,000, but only after undergoing a correction that finds a bottom between $3,000 and $5,000.
Clem Chambers, CEO of ADVFN, also warned of a deep correction and said Bitcoin’s price could fall as low as $2,000 before recovering and reaching much higher levels (paraphrased):
It will likely reach $2,000 before it reaches $20,000. There is not enough money currently moving to create the necessary momentum. Cryptocurrencies fill that vacuum. Where economic demand exists and cryptocurrencies fill that space, that will eventually produce an economic upswing for Bitcoin.
Some experts agree that Bitcoin — and by extension the entire cryptocurrency market — has not yet reached a definitive bottom before another sustained rise can begin. Whether and when a lasting bull market will return remains uncertain.
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