Mark Mobius, the godfather of emerging markets, said that the price of Bitcoin may fall below $10,000 in 2023, a drop of more than 40% from the current price.
Previously, he had accurately predicted that Bitcoinwould fall below $20,000. He said that Bitcoin has fallen below the technical support levels of $18,000 and $17,000, so it is not far from falling below $10,000. He told the media that his reasons for being bearish on Bitcoin are rising interest rates and tightening monetary policy by the Fed.
As interest rates rise, it becomes less attractive to own bitcoin or other cryptocurrencies because you cannot earn interest on just holding bitcoin. Of course, there were plenty of companies that offered 5 percent or more on cryptocurrency deposits, but those companies basically went bankrupt, he said.
As a result, as investors experience losses, people become more afraid of holding cryptocurrencies to earn interest. The cryptocurrency boom is tied to the Fed’s money-printing frenzy. Over the past few years, the dollar money supply has grown by more than 40%. He explained that when the Fed starts withdrawing liquidity, people’s ability to invest in the market becomes difficult.